Have you been keeping up with California’s recent news regarding taxes? From cannabis to tap water and gas, California’s various tax legislation would impact all residents. Here’s a recap of each one.
California’s Taxes on Gas
Senate Bill 1 increased gas taxes by 12 cents per gallon, diesel fuel 20 cents per gallon and raised vehicle fees. The legislation was approved by both the Legislature and the governor back in April and is projected to raise $5.4 billion a year for road and transit projects. While the tax revenue is earmarked for important work within the state, 51 percent of registered voters report they’d repeal the tax if it were placed on the statewide ballot in November.
California’s Taxes on Water
That’s right – there is proposed legislation to tax water. As the first taxes on tap water in California’s history, the revenue, “Would go toward addressing drinking water tainted with arsenic and other contaminants in the San Joaquin Valley.” Both residents and businesses would be responsible for the tax, with an increase of either 95 cents or $15 per month on their water bills, depending on which legislation passes.
While opponents to the bill agree the clean water concerns need to be addressed, they believe the legislation would, “Make it harder for low-income residents to afford this necessity. A precedent-setting tax also could lead to additional taxes on water for a variety of project and programs.”
California’s Taxes on Cannabis
One of California’s taxes that is definitely bringing in much-needed revenue is on cannabis. In fact, during the first quarter of 2018, the state saw $60.9 million generated from cultivation, excise and sales taxes; the figure doesn’t include local tax revenue that cities and counties collected from the industry.
Two new cannabis taxes began this past January, “A cultivation tax on all harvested cannabis that enters the commercial market and a 15 percent excise tax on the purchase of cannabis and cannabis products.” In the first quarter alone, the cultivation tax brought in $1.6 million and the excise tax generated $32 million of the total $60.9 million.
What do you think of these taxes California is imposing? Do you agree the gas tax should be repealed, or do you think it’s a good solution to the state’s road and transit projects? What about the water tax? Do you think it should pass?
As always, please contact us if you have any questions about how taxes from California or other states may impact your business; we’re happy to answer your questions and help you navigate any multi-state issues you may be facing!
Miles Consulting Group, Inc. is a professional service firm in San Jose, California specializing in multi-state tax solutions. Our firm addresses state and local tax issues for our clients, including general state tax consulting, nexus reviews, tax credit and tax incentive maximization, income tax and sales/use tax planning and other special projects. To learn more, contact us today at www.MilesConsultingGroup.com.
