California Considers Doubling Taxes to Provide Health Care for All Illegal Aliens; Top Rate Would be 18 Percent

 

California Democrats can never do enough to sabotage their state.

Last week, U-Haul Vice President Stuart Shoen spoke to Fox Business News’ Stuart Varney about the “mass exodus” out of California in 2021 which he said made it difficult for the company to “meet our customer demand.”

If that’s currently under consideration in the state legislature should become law, Shoen had better brace for an all-out stampede in 2022.

California currently provides free health care for illegal aliens aged 26 or under and for those over 55. The legislation, if passed, would establish single-payer health care in the state. 

The price tag of this initiative would be eyepopping. It would nearly double the state’s tax burden, which according to the non-partisan Tax Foundation, is the third highest in the nation (behind New Jersey and New York).

Jared Walczak, a fellow at the Tax Foundation has analyzed what passage of Assembly Constitutional Amendment 11, which is intended to raise an additional $163 billion in revenue per year, would look like for taxpayers in the state. (Fox Business News notes that $163 billion is more than the state collected in total tax revenue any year prior to the pandemic.)

For all the dirty details of ACA 11, Walczak’s full analysis can be viewed here.

Here are the highlights (via Fox):

Under the bill, the top marginal rate on wage income would soar to 18.05% – well above the median top marginal rate of 5.3% and the state’s existing rate of 12.3%. There would be an 18-bracket system, with higher taxes kicking in for individuals earning more than $149,509. The highest rate would apply to those who earn more than $2,484,121.

California would also expand the payroll tax paid by employees who earn more than $49,990 in annual income if they work for a company that has more than 50 workers. Walczak noted the plan could deter small businesses from expanding by inadvertently creating a tax cliff. For instance, if a company that had 49 workers earning $80,000 each hired one additional employee, they would suddenly create a tax bill of more than $90,000.

Finally, the state would also adopt a new 2.3% gross receipts tax (GRT) on qualified businesses minus the first $2 million in annual gross receipts, at a rate more than three times that of the country’s current highest GRT.

Walczak prepared the table below which shows the proposed income breakpoints for both single and married taxpayers in the 18-bracket system. 

2.25%:          $0

3.25%:       $9,324                 $9,324

5.25%:     $22,106               $44,213

7.25%:      $34,891              $69,783

9.25%:      $48,434              $96,869         

10.25%:    $49,900               $99,800

11.55%:    $61,213             $122,427

12.05%:  $149,509              $149,509

12.55%:  $299,509              $299,509

13.05%:       —                   $599,013

13.55%:   $312,865                  —

14.05%:        —                  $625,371

14.55%:  $375,220                   —          

15.05%:  $599,013              $750,441

16.05%:  $625,368           $1,000,000

17.05%:  $1,000,000        $1,250,737

17.30%:  $1,299,500        $1,299,500

18.05%:  $2,484,121        $2,484,121

If Schoen thought it was difficult for the company to meet customer demand last year, wait until ACA 11 passes.

 

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