California leads the nation in many things, but that’s not always a good thing. After a historic year, raising billions in taxes on middle-class Californians, Sacramento has given us the country’s highest income tax, highest sales tax, highest vehicle tax and highest gas tax in the nation. As a result, California ranks first in poverty in the U.S.
California’s tax-happy culture is crippling ordinary people. One in five Californians live in poverty. More than a million people have moved away because the cost of living in California is just too expensive. These are teachers, carpenters and small business owners packing up and leaving. For a small business owner like myself, I am negotiating the death of my business every day when the Legislature is in session.
President Trump and Congress have proposed a plan to simplify the tax code in a way that will help middle-class families. I hope they follow through and deliver for Californians who desperately need a break. More than reducing taxes, Congress should simplify the process of paying taxes so small business owners and working people don’t have to spend hundreds of hours trying to comply with a rigged system.
The proposed tax plan will level the playing field for working class Americans by removing loopholes and deductions that only elites with tax savvy accountants can take advantage of. At the same time, it protects the middle-class by safeguarding incentives for homeowners’ mortgage interest, charitable donations, higher education and retirement.
It roughly doubles the standard deduction to ensure that employees can take home more of their hard earned money to pay for groceries, gas and essential items, instead of ineffective federal programs. It also increases the Child Tax Credit, giving relief to struggling families.
American companies have been handicapped with a 39 percent business tax while other modern countries enjoy a much lower rate. The proposed plan drops that tax rate to a competitive 20 percent, allowing American companies to employ more workers at better pay and compete in a global economy. The changes in the tax code should strongly encourage Silicon Valley technology companies with money in foreign offshore tax havens to bring that money home and invest in California jobs and infrastructure.
There are also options on the table now that also help small businesses get a boost. The reforms will reduce the maximum tax rate for small and family owned businesses, like my farm, to 25 percent.
This proposed tax reform isn’t just about businesses though, it’s about people. It balances reforms with tax relief for ordinary Americans. California is a high tax state and the impacts of that can be seen everywhere. Because we have some of the highest taxes in the nation, Californians have a lot at stake in the current debate in Washington. As a Republican in the Legislature, I have consistently voted against higher and more complicated regulations. It is my hope that the President and Congress are successful in their efforts. We need all the help we can get.