Today is tax day, and the natives are restless. Around the country and here in California, anti-tax groups are planning a series of "tea parties" to protest the rising burden of government and the services it provides.
The national and state scenarios are mirror images of each other. On the national scene, we are getting a lot more government, but most of us, at least for a while, are going to be paying less in taxes. In California, we will be getting less government but paying more for it.
Actually, thanks to the recent tax hike, we are paying now for the government we have been getting for several years, services that had been financed with borrowed money, gimmicks and fund shifts. And even those higher taxes – on sales, cars and income – won't produce enough revenue to pay the projected long-term costs of state government. More taxes, or fewer services, are in our future.
So are we a high-tax state? Yes. But we are also, even in the midst of a recession, a high-income state. That means our tax burden relative to the size of our economy is not quite as high as our absolute tax rates suggest.
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