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Government & Politics

Low-Income Californians Pay More State and Local Taxes Says Study

Valley Public Radio

A new report says adjustments to Proposition 30 and other tax policy changes could improve the situation for low-income Californians who pay a disproportionate share of their income in taxes.  From Sacramento, Max Pringle reports.

The California Budget Project says the bottom 20 percent of Californians pay more than 10 percent of their income in state and local taxes, while earning about $13,000 a year on average. The top one percent pay just under nine percent. They earn an average $1.5 million dollars per year. Luke Reidenbach is a Budget Project analyst.

Reidenbach: “Over time, income is increasingly concentrated at the top. Right now, about 20 percent of income in the state goes to just the top one percent of Californians.”

The study says the temporary sales tax increase under Prop. 30 disproportionately effects low-income people and should be allowed to expire. The study also suggests the state create an “earned income tax credit” to extend the federal credit.