Cost Cuts and Tax Increases Give California Budget Surplus
Cost Cuts and Tax Increases Give California a Budget Surplus
In one of the biggest turnarounds we’ve witnessed, California, which recently was facing a $16 billion budget deficit, now predicts an $851 million surplus thanks to Governor Brown’s new budget plan. You can read the Reuters story at http://www.huffingtonpost.com/2013/01/10/california-budget-surplus-2013_n_2450349.html
Why You Should Care
If California can do it, can’t Washington do it? This is one of the quickest and most impressive turnarounds we’ve witnessed. It appears the recent tax increases residents voted for, along with the will to fight reversing spending cuts made to social programs during the recession, dare we say a balanced approach, has yielded fruit. Congratulations California. It is sad however, that high income earners could see their combined tax rate rise to over 50% due to the passage of Prop 30 as well as increases to the top federal tax rate, capital gains rate, dividend rate, payroll tax, and new healthcare tax.