If you’ve looked at your paycheck recently you’ll notice that it’s 10% less than it was last month. And the California legislature is hoping you won’t notice. How can you get it back? Look at the bottom of this post!
That’s right…as of November 1, 2009, the state of California began taking an extra 10% out of your paycheck, on top of whatever else they take out. How can they do this, you ask?
As you all know, California was in deep trouble over the summer (and still is) and needed to find a way to close the budget deficit they’ve created from their drunken sailor spending habits for our ridiculously overpaid labor unions, teacher’s unions, government workers and our miles long list of welfare and entitlement programs for the “poor,” the illegal, the dumb and the fraudulent. Here are some of the ways they shafted the California taxpayer…
- State incomes tax rates were increased by 0.25 of a percentage point across all tax brackets. This means you.
- Your dependent credit was slashed by two-thirds.
- State sales tax rose by 1 percentage point.
- The vehicle license fee nearly doubled to 1.15% of a car’s value
And the real kick-you-while-you’re-down sucker punch….a 10% additional withdrawal from your paycheck every pay period starting a few weeks ago. Our elected officials have some big brass apples to increase our taxes, slash our deductions and make the price of everything we buy more expensive. And then, right before Christmas, they snatch another 10% from our mouths. How Grinchy.
According to Christopher Thornberg, a principal with Beacon Economics in Los Angeles, such temporary measures as tax withholding increases don’t really fix the budget gap, “they just more or less hid it.” And what does Mr. Thornberg think of such tactics? “I call it fraud.”
In the list of possible responses to a recession that economists say are the absolute worst things you can do, every single bullet point above is on that list. It’s not rocket science…if you take more of my money away from me…I have less to spend that would help the economy. I am both sickly and morbidly fascinated by the complete lack of respect, honor and intelligence in Sacramento. And the real shame of it is, we put them there and gave them this power to shaft us.
Now, Sacramento had to do some significant cost cutting, of course. All summer they spewed doom and gloom all over us so we would vote ourselves another big tax increase on top of the one they had just passed. They threatened us that parks would be shut down, felons would run rampant in the streets, and fires would burn uncontrollably for days due to a decrease in public services. And what happened? Nothing! We did not vote for the second tax increase and the summer has come and gone and Armageddon is nowhere to be found.
That should tell you one thing. One very important thing. After all those billions they slashed from the budget this summer…we’re still here and life is fine. And that should tell you one more thing…there are probably billions more that could be cut without a change in our daily lives. That’s how much fat…how much pork…was in the California state budget…that they could cut billions of dollars and we felt nothing.
To prevent additional cuts, they are forcing us to lend them 10% of our paychecks. We don’t get a dime in interest payments for loaning them this money. Come next year when we do our tax returns, they are supposed to apply this extra money they stole from us to whatever we owe them in taxes, or send us a larger refund. It is completely unfair that a government can reach into your pocket and force you to give them more money just because they want to protect their bloated budgets.
Fight back! Here’s how…
Brenda Voet, a spokeswoman for the state’s Franchise Tax Board admits that, “people can get out of this.” California’s budget leaders however are hoping you won’t notice the increase or take the steps to reverse it. Fill out this form from the EDD, increase the number of your withholding allowances, then give it to your HR department. It’s that easy.
Go to this website and use their calculator to determine how many withholding allowances you should add to offset the increase from the state.
And the future?
Even know, Sacramento is still at least $1 billion short of their assumptions [update: $21 billion short here] which means they will probably continue to take this extra 10% for as long as you are willing to let them. They are still in trouble, still can’t balance the budget and will still have to come up with new and creative ways to take more from us. According to the L.A. Times, “outsize deficits are projected for years to come.”
So don’t think this is the last trick Sacramento will play on us.
Categories: Government Failures, Personal Economics
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