I was unhappy to see the California budget balanced on the backs of California retailers. The 1% sales tax increase is another slam against brick and mortar retailers and the customers that frequent them. You would think if you wanted consumers to start spending again, you would avoid disincentives that push them online to buy from other states (evading taxes), or forces them to stay home.
What the state governments would really like to do is get hold of those evaded taxes, or "use tax" that people avoid paying with many Internet sales. Most people don't know this, but every purchase from a retailer online is subject to California state sales tax, even when they don't charge you. You're supposed to report this on your taxes, but it's ignored by just about everyone (it's apparently a red flag for retailers in some states, resulting in a near automatic audit).
The other annoying tax is the VLF, or Vehicle License Fee, which gets doubled under the new budget. This is a regressive tax of the worst kind, one that imposes a greater burden on the poor than the rich. I, being closer to the poor category, find it especially vexing. I pay little state tax because of my income and business, but the VLF fee would be the equivalent of doubling my state income tax. State income taxes are going up a quarter of a percent as well. Until the state does a comprehensive overhaul on how it generates and spends our money, we'll always have these kinds of problems in hard times. There's talk of reform already.
