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August 13, 2003
FOR IMMEDIATE RELEASE
Contact Roland Boucher
14252 Culver Drive #728, Irvine CA 92604
949-552-9174 or Roland@CalSimpleTax.org
CALIFORNIA SIMPLE TAX: OFFICIAL TITLE AND SUMMARY OF THE MEASURE AS RECEIVED FROM THE SECRETARY OF STATE
ALTERNATIVE INCOME TAX RATE, INITIATIVE STATUTE
Amends California’s income tax law to provide an alternative standard deduction and tax rate for taxpayers with adjusted gross income for the taxable year of $50,000 or less for individuals, and $100,000 for married couples filing jointly. Qualifying taxpayers may choose to take a deduction equal to California's minimum wage effective for the taxable year, multiplied by 1,040 for individuals, or multiplied by 2,080 for married couples filing jointly, and pay 2.5% tax on the adjusted amount.
Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local governments:
The Simple Tax is Simple
The California Simple Tax gives taxpayers the opportunity to compute their taxes on a simple, one page tax form and following a simple six page instruction set instead of being forced to interpret the 63 pages of nearly unintelligible instruction provided with today’s 540 form.
The Simple Tax Reduces Record Keeping
No longer would taxpayers be forced to waste a tremendous amount of time and effort to keep financial records just to protect themselves from the government in case of future audit. All data needed to comply with the proposed tax would come from a third party such as banks, employers, etc. eliminating the need for an audit.
The Simple Tax May Reduce your Taxes
This Measure will allow taxpayers who do not claim itemized tax deductions to pay no more than the average tax imposed at their income level. Since taxpayers will now have the choice of selecting the tax form which provides for the lowest rate of tax, the revenue to the State from the Personal Income Tax may be reduced two or three percent. There will be a slight reduction in the cost of tax collection and many taxpayers will no longer require assistance in tax preparation.
The Simple Tax builds on Existing Tax Reforms
In 2000 California State Controller Kathleen Connell introduced the 540-2EZ postcard sized Tax Form which was well received by the 2 million taxpayers who were allowed to use it. We build on this reform by allowing the 3.5 million Seniors over 65 and the nearly 8 million Taxpayers who claim the Standard Deduction to use our new tax form.
The Simple Tax provides relief to over 10 million Taxpayers
Today 30 percent of tax filers chose to itemize their deductions. these Itemized deductions increase in value with increased income. The current Tax Code imposes ever increasing tax brackets (4%,6%, 8%, & 9.3%) on these taxpayers to counteract the benefits of the itemized deductions allowed them. We expect to induce many of these taxpayers to use the CA Simple Tax Form by raising their standard deduction allowed and limiting the tax rate to 2.5 percent.
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