Democrats' Rasing Income Tax & Car Tax

[Matt]

California legislators are expected to vote late today on a $17 billion package of tax increases and program cuts pushed by Democrats to help bridge the state's massive budget gap. Republicans were quick to criticize the proposal, however, saying it would not win GOP votes and does nothing to stimulate the economy or provide hope for the unemployed.** "It's not what Californians need," said Assembly Republican leader Mike Villines. For every $1 in tax increases, there would be $1 in state cuts, say Democrats who have released a summary of the budget plan headed to lawmakers.

Taxpayers will pay the same amount of taxes on the same level of income in 2008 as they did in 2007. That means a $79 average tax increase for taxpayers with Adjusted Gross Incomes (AGI) between $40,000 and $50,000; $127 average tax increase for taxpayers with AGI between $50,000 and $100,000; and $200 average tax increase for taxpayers with AGI above $100,000.

Vehicle License Fee. Restores the Vehicle License Fee (VLF) to two percent of a car's value. The VLF is calculated based on the purchase price of the car, with an annual depreciation of 10 percent. I.e. a car bought five years ago for $20,000 would be valued at $10,000, the VLF would increase by $135.