Republican and Democratic Senators sparred over the proposed GOP backed tax-reform plan on Nov. 30. . US Senate Television
Republican and Democratic Senators sparred over the proposed GOP backed tax-reform plan on Nov. 30. . US Senate Television

Editorials

How bad is the GOP tax plan for California? Republicans don’t even like it

By the Editorial Board

December 01, 2017 04:55 PM

UPDATED December 02, 2017 01:17 PM

We’re sure it comes as no surprise to anyone in America, much less inside the Beltway of Washington, D.C., that the GOP tax plan zipping through Congress is deeply unpopular in liberal California.

On Friday, Republicans in the Senate announced – in between dodging questions on Michael Flynn – that they had cobbled together enough votes to pass their version of the bill, which would overhaul the nation’s tax system to favor corporations and wealthy individuals.

Now the bill, so bloated that it’s expected to add $1 trillion to the deficit, goes to conference with House to come up with a compromise to send to President Donald Trump.

Senate Majority Leader Mitch McConnell, the supposed fiscal conservative, was pleased. So was Trump.

Never miss a local story.

Sign up today for a free 30 day free trial of unlimited digital access.

“The Bill is getting better and better,” the president tweeted Friday. “This is a once in a generation chance. Obstructionist Dems trying to block because they think it is too good and will not be given the credit!”

Not to throw cold water on Republicans’ fevered delusions of grandeur, but “Obstructionist Dems” from liberal California aren’t the only ones trying to block their legislation.

A recent poll from Reuters/Ipsos found that 49 percent of Americans who know what’s in the Senate tax bill oppose it, up from 41 percent in October. Only 29 percent of respondents indicated they supported it.

And in a clear failure of messaging – or perhaps a triumph of truth – to all but the most faithful of Trumpsters, more than half of respondents said mostly wealthy people will benefit from the legislation, and only 6 percent said it was designed to help the middle class.

Even deep-pocketed almond growers from California’s reliably Republican counties in the Central Valley hate it.

Bill Lyons, a politically connected farmer who wrote an op-ed for The Sacramento Bee on behalf of other politically connected farmers, called out the state’s Republican delegation. He and other growers are urging that House Majority Leader Kevin McCarthy and others block a provision in the Senate version that whacks a federal export tax program relied upon by the $5 billion industry.

“Roughly 104,000 California jobs generated by the almond industry are at stake in the fast-moving tax overhaul being debated in Congress,” he wrote, “and 97,000 of those jobs are in the Central Valley where the ag-dependent economy has struggled for a decade.”

Then there are the parts of the tax overhaul that would affect all of Californians.

A big one is eliminating the deduction for state and local income taxes. The Golden State has the highest top state income tax rate in the nation and residents claimed a whopping $70 billion in such deductions in 2014.

There’s also the repeal of several tax exemptions and deductions that benefit poor and middle-class students pursuing doctorates and master’s degrees, as UC Davis Chancellor Gary S. May wrote in an op-ed. That’s in the House bill.

Some homeowners would get a minor reprieve with a compromise hammered out on Friday to include a $10,000 deduction for property taxes in the Senate bill. But the property tax deduction is far less valuable to Californians than the deduction of state income taxes because property taxes here are relatively low.

There’s no way to sugarcoat how bad Republican-led tax reform would be for California. But there’s also no way to sugarcoat the effect on poor and middle-class people all over the country. Voters should remember this in elections in 2018.