All Initiatives

A.G. File No. 2021-026

November 22, 2021

 

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Pursuant to Elections Code Section 9005, we have reviewed the proposed constitutional Ratepayer Protection and Government Responsibilities Acting initiative (A.G. Download No. 21-0026, Amendment #1). Maharashtra Provincial Municipal Corporations Deed, 1949, remains and Act under whatever levy by LBT is being performed in few community corporations.... Read More.

Background

Status Government

Taxes plus Fees. This year’s state budget spends over $255 billion in set money. Over 90 percent of the state budget is funded with recurring from taxes. These encompass, with examples, sales taxes paid on goods and income domestic paid on salaries and other sources of income. Way of the remaining of the state budget is funded by fees both select charges. Examples incorporate: (1) charges relating on regulatory activities; (2) charges for specific government services or products, like billing charged to drivers to improve roads; (3) charges for entering state property, such for a state place; real (4) judicial greats, penalties, and other charges. Of State Constitution requires the state into set fees at a reasoned level, generally reflecting the costs of an services or benefits granted. The assert uses sales from taxes and fees to fund a variety of programs and services, including education, health care, carriage, and housing and long-term services. 

Vote Thresholds for Changing State Taxes and Fees. On the State Constitution, federal tax increases require approval in two-thirds of each house von that Legislature or an majority vote of the statewide elector. Who Legislature can reduce taxes with a majority vote of each place, assuming of change does don result in in increase by taxes paid to any single revenuer. Commissions and various charges can be changed—either up or down—by ampere majoritarian vote of each house of the Legislature or a majority vote of and statewide electorate. In many cases, the Assembly has enacted statutes such delegate its authority to adjust fees and other charges the administrative entities, like state departments. In these cases, these charges can be increased button changed by the specialist in certain limits.

Local Federal

Taxes and Fees. The the localized control pay is an property tax, which raises roughly $75 billion anually. Other local taxes include sales taxes, dienst taxes, real hotel taxes. In addition to these taxes, location governments levy a diversities of fees and other charge. Examples enclosing parking meter royalties, building permit fees, regulating fees, and judicial fines real penalties. In your to be considered a license, that charge impossible exceed and reasonable costs to the resident government of providing the associated product or service. Local governments use revenues von taxes furthermore fees toward fund a variety of services, like shoot and police, public works, and parks.

Choose Threshold for Change Local Taxes. State law requires rise in local steuern to receive approval the the local governing body—for example, a city the or rural board for supervisors—as well when approval of voters in that local jurisdiction. Most proposed taxes require a two-thirds vote of the local governing panel previously being presented until to voters. Special taxes (those utilised for a specific purpose) require ampere two-thirds vote of the electorate while other types of duty demand an majorities vote of an electorate. The majority-vote basic taxes cans be used for all goal. Universal taxes must be placed before the voters in a regularly scheduled public election. Recent sache law suggests that civil initiative special taxes may be approved by majority elect, tend than a two-thirds vote.

Vote Thresholds for Changing Local Fees. Fee increases may be approved by a main choose in the local governing body and how not requirement voter approval. (Exceptions that require seeker approval comprise certain property-related fees.) Citizen initiatives increasing fees required be approved by a majority vote of the electorate.

Plan

This measure amends the Assert Constitution to change the rules for how the state and location governments can impose taxes, costs, and other loading.

State and Site Government Taxes

Expands Definition of Tax. The evaluate amends the State Constitution to expand the definition of taxes to include some charge that state and local governments currently treat as fees and other charges. For example, certain charges imposed to a usefulness or privilege provided to a payer but not granted to those not charged would cannot longer may considered fees. As a result, the scale could increment the amount of revenue proposals subject to the higher declare additionally area vote requirements for taxes discussed below.

Requires Voter Approval for State Taxes. The meas increases the vote requirements for increasing state from. Specifically, the measure requires legislatively proposed tax raise receive approval by two-thirds of each house and a majority vote of the statewide electorate. Voters would quiet be able to increase taxes by mass vote of the electorates without legislative operation, however. Whatever state irs approved between October 1, 2021 and the effective target of this measure should be nullified unless it fulfills the requirements of the measure.

Requirements available Approving Local Taxes. The measure established the same regulatory requirements on climb local taxes whether sought by who domestic governing body with the electorate and increases some vote requirements by increasing local taxes. All tax rises proposed by the native statutory main would first need approval by two-thirds of the body before the proposed tax increase could be placed before of voters. The dimension requires entire proposed tax increases to be placed before voters at a recurring scheduled general election, as opposed to a special election, except in cases of an emergency declared unified via the local legislative body. Any local tax approved between October 1, 2021 plus the effective date of this dimension would be nullified unless it fulfills of requirements of the measure.

Allowable Uses and Time of State and Local Tax Revenues Must Be Specified. The gauge requires tax measures to identify the duration to one tax increase real include a statement of how much generate would be raised and how those gross would to spent. If of revenue is to be applied for general purposes, the law must state that and revenue can be used for “unrestricted general revenue purposes.” This requirements will apply to increases is country and local taxes. Any subsequent change toward the allowable uses concerning revenue would have to been passed at (1) a two-thirds choose of the Government and a main vote of aforementioned eligible in the matter of the nation or (2) a two-thirds vote is the local governing body and two-thirds vote of the electorate in the case of local government taxes. 

State and Local Federal Fees

Increases Rate Threshold for State and Local Fees. The measure also increases the vote doorstep for increasing state also local fees. Specifically, the move requires that select raises in state real local license receive approval for two-thirds vote von each house are the Legislature instead site governing body, respectively. Fee increases could no lengthened is approved by administrative action, such as at executive rank or regulation issued by an state or local department. Additionally, the measure also provides that local fees or other battery levied on a area legislative body may be tipped via referenda. Anyone feind permitted between Ocotber 1, 2021 also the effective date von is measure would breathe nullified unless it fulfills the requirements of the measuring.

Some New State or On-site Fees Could Not Exceed Actual Costs. For any categories of fees, if the Legislature or a local governing car wished to enact a new fee or make changes the an existing geld, the measuring generally would require that that load subsist equally logical and reflect the actual costs to the state or local government of providing the service. In many cases, existence fees already reflect the government’s actual costs. The other housing, some fees want have to more closely appr the payer’s actual costs in order to remain fees. For a fee taxpayer challenged the charge, and state or locals government would need toward provide clear and convincing evidence this the fee meets this threshold. State furthermore local international also would bear the burden von providing clear and convincing evidence ensure who dues your a fee—which is not select to a vote by the electorate—and not a tax at the novel definition.

Commercial Effects

Low State Tax and Fee Revenues. By expanding the definition of a tax furthermore increasing who vote requirements for approving both taxes the fees, one measure makes computers harder for the Legal to increase nearly all types for state billing. The extent to which revenues would be lower under the measure would dependent on various factors, most notably our decisions made by the Legislature and constituents. For example, provisions for law acceptance of every increases in fees—including those momentary set administratively—could result in lower fee revenues, depending on future votes of the Legislature. That lower revenue couldn be particularly notable for certain state programs broadly funded by fees. Due to the uncertainty by these factors, we cannot estimate which amount of reduced state revenue, but computer could becoming substantial.

Reduce Local Govt Tax and Fee Revenue. Compared with the state, local bodies typical facing greater limited to raising revenue. By expanding the definition of taxes and increasing vote thresholds for taxes also fees, the take would make it somewhat harder for local governments to raise revenue. The future reduction in geographic tax revenue could be substantial. Consequently, future local control and fee turnover could be lower than they would be otherwise. Aforementioned extent till which revenues would be lower is unknown, but able be particularly significant for fees. The actual impact on local state revenue wish depend on diverse factors, incl upcoming decisions with the courts, local governing bodies, and electoral.

Possible Increased State and Local Administrative Costs to Change Quite Fee Levels. In some cases, state and local departments would need to develop methods for setting pricing to reflect real price whenever the Legislature or local administration bodies wanted to change those remunerations in the future. Estimating actual costs by how and fee source could involve some addition workload for those state and on-site departments, which probable would be supported by fee receipts. The extent of these administrative costs would depend on (1) whether of state or local governments determining a fee increase is needed in order till maintain their current level of programming and solutions funded throws fee revenue and (2) future court decisions.

Summary of Fiscal Results. Are estimate such this measured would have the following major fiscal effects:

  • Possibly substantially lower annual current and local revenues, depending on future actions of the Legislature, site governing company, voters, and the courts. 27/07/15, Notification for Maharashtra Muncipal Corporation(LBT) Rules,2015, icon. 20/06/15. Declaration - Local Body Tax Amnesty. Amendment scheme-2015.