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Sales Tax Jumps from Proposition 30

Pennies heading to Sacramento

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    NEWSLETTERS

    Consumer Bob

    You voted for it, now you pay the bill: That's one way of looking at Proposition 30, which increases California sales and income taxes in 2013.

    The proposition promised to raise more than $8 billion for California schools and colleges.

    New Year, New Tax Increase in California

    [DGO] New Year, New Tax Increase in California
    The sales tax increase associated with Proposition 30, the tax increase that promised more money to California schools, has taken effect. Consumer Bob talks to local business owners to find out if shoppers will feel the pinch.

    But Steve Wiley of George's Camera in San Diego worries it could also hurt his profit at the cash register.

    "Any tax increase always takes a little bite out of our business," said Wiley.

    But the bite won't be very big.

    Proposition 30 raises sales taxes by an additional quarter of a cent. That means a penny more for a fancy coffee, a dollar more for a high end camera, nearly $100 more for a luxury car.

    "It's not going to have much impact on the consumer," said NBC 7's George Chamberlin. "The more you spend, the more visible the tax." 

    The Prop 30 sales tax increase is good for four years. It also increases California personal income taxes for seven years on people earning more than $250,000. Those people will pay 1 percent more retroactive to their 2012 tax returns. People making more than $300,000 will pay 2 percent more, those making more than $500,000 will add 3 percent to their income taxes.

    Camera store shoppers, like Christopher Ward, says he doesn't mind the sales tax increase if it goes to a good cause.

    "As long as it goes to a good purpose and it's accountable, then I don't have a problem with it," said Ward.

    Felix Senquiz agrees.

    "It's a reasonable rate, I mean if it really is going to do us some good," she said.

    The biggest question is how much more the state will want in the future.

    "What if they [California] decide, well, we need to do it again, and again, and again," said Chamberlin.

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