Starting over two years ago, I wrote an occasional column conjecturing about which taxes might appear on the statewide November 2016 ballot via the initiative process. Changing political strategies moved the targets over time as I listed what I perceived to be the top five tax items that were being discussed as ballot initiatives. Now that the deadline for confirming General Election ballot measures has come, I can review my predictions and see how I did.
From the beginning it appeared likely many tax initiatives would be pursued. Given that initiative signatures needed to qualify a measure for the ballot was determined by the 2014 gubernatorial vote–a historical low — a hurdle for qualifying initiatives was greatly reduced. Also, the idea that the 2016 presidential election would bring out a higher turnout of voters who might be amenable to supporting tax increases proved an incentive to those who want more taxpayer money for different reasons.
Obstacles in the way of those seeking higher taxes was a state surplus and the potential ‘death by a thousand cuts’ theory– many tax increases on the same ballot turning off voters and encouraging voters to say “No” across the board.
The extension of the Prop 30 income taxes (now Proposition 55) was always a top contender throughout the two-year prognostication period. The teachers associations behind the extension always had the resources to qualify the initiative. Once a deal was cut with Medi-Cal providers to apportion the revenues gained by the measure with each entity reaping tax dollars, even more resources became available assuring qualification.
Likewise, it always seemed certain that the cigarette tax increase would find its way on the ballot. That certainty was enhanced when billionaire hedge fund political activist Tom Steyer kicked in a million dollars to help with the signature drive and campaign. A cigarette tax is on the ballot as Proposition 56.
Looking back, I had the income tax extension and the cigarette tax as either one or two on my lists a number of times from mid 2015 on. I appeared more certain about the income tax extension earlier, however, because while the cigarette tax was always in the top five in 2014 and early 2015 it was listed fifth, then fourth, probably before the Steyer money appeared.
Property taxes were found consistently on the list either in the form of a split roll to tax commercial property on a different basis than residential property or the proposal that was circulated to add a surcharge tax on all property assessed over $3 million. Both measures went away—for now. Here the concern that too many tax increases on the same ballot certainly played a role as proponents of the property tax measures were lobbied by expected allies in the public unions to cease their efforts out of concern that too many tax measures on the ballot would doom to defeat other initiatives they cared about.
One tax I whiffed on was an oil severance tax. In June 2014, I had an oil severance tax third on my list of potential 2016 tax ballot measures and jumped to second the next March before it disappeared all together. I saw an attack on oil companies as compelling to some, especially Steyer who was talking it up and had the wherewithal to qualify such a measure. However, his interest drifted elsewhere.
For a brief moment I had a soda tax on the list and even last year placed a foolish declaration that there would be no new tax measures following the announcement of a healthy budget surplus with more expected to collect in the state coffers. Foolish, indeed.
Finally, I did recognize the tax provisions in the initiative to legalize marijuana. I wondered if it should even be considered as a tax initiative since the goal of the marijuana proposition was legalization, not taxation. However, with local governments making plans to cash in with tax revenue if the marijuana initiative, Proposition 64, passes, the desire of government for more tax dollars has raised its head and the marijuana tax must be considered as the third tax that will face voters in November.
(Featured image by: Justin Metz, Getty at carolfrank.com)