California Could Be First State to Impose a "Savings Tax"

California’s taxes are already the highest in the country, but now California Democrat politicians want even more money from residents in the form of a new tax on the assets, investments and even savings accounts held by residents.

The Democrat politicians claim the tax will only be paid by the “richest residents” in the state and have dubbed their proposal a “Wealth Tax” but opponents like Reform California Chairman Carl DeMaio says the proposal needs to be best understood as a “Savings Tax.”

“Californians are already paying the highest taxes on everything they earn, everything they buy, and every property they own - and after all that, if they manage to save or invest any assets, California Democrats want to take a chunk of that too,” DeMaio said. “California Democrats are punishing people who save for a rainy day,” DeMaio noted.

Assemblyman Alex Lee has introduced Assembly Bill 259 – and an accompanying state constitutional amendment with ACA 3 – to impose a new tax of 1 to 1.5 percent upon the “worldwide net worth” of California’s millionaires. It would also create a Wealth Tax Advisory Council and allocate a minimum of $325 million for the purpose of administering and collecting the tax. Lee’s proposal is projected to impose an extra $22 billion a year in state tax burden on residents.

If AB 259 and ACA 3 pass, California would be the first state in the country to impose a “Savings” or “Wealth” tax. The proposal originally was proposed by national Democratic Socialists - including Senators Elizabeth Warren and Bernie Sanders. Washington state is considering a similar proposal.

Lee said when announcing the bill that he wanted the “rich to be paying their fair share.” But DeMaio says every taxpayer needs to worry.

“Just as they did with the Income Tax when it was first imposed more than a century ago, once the Democrats create this Savings Tax it will quickly be expanded to include everyone,” DeMaio noted.

DeMaio also predicts that the tax increase will actually cause the state to lose tax revenue.

“You can only tax people so much before they say ‘enough’ and leave — California families and companies are fleeing the state every day because they can’t afford to stay,” said DeMaio. “Just look at Tesla, which shifted operations to Texas for better tax laws — we’re driving these people and jobs away because liberal politicians are greedy for more and more of your hard-earned tax dollars,” he concluded.

DeMaio and Reform California are committed to exposing and fighting tax increases like the California Savings Tax, and they have a record of success.

DeMaio spearheaded the signature drive to get the Gas Tax repeal on the ballot in 2018. DeMaio and Reform California have run successful campaigns that have blocked billions in costly tax proposals in just the last decade - including a number of local sales and property tax hikes, a statewide Water Tax and Text Tax, and even fees that masquerade as taxes such as the Mileage Tax.

DeMaio says the first step to defeating taxes like the California Savings Tax is spreading the information with friends and family — and supporting Reform California’s efforts to get the word out to target voters.

DeMaio is also leading the campaign to pass the “California Taxpayer Protection Initiative” in the 2024 statewide election. This constitutional amendment would require any new tax hike must be approved by 2/3rds of voters – and requires honest ballot titles and summaries be used in describing any tax hike proposals on the ballot.

“I’m asking concerned Californians to join our campaign today to block the crazy Savings Tax proposal and other costly tax hikes by helping us pass the California Taxpayer Protection Initiative in 2024,” said DeMaio. “With your help, we can win the fight to block these taxes and make California more affordable for our families,” he concluded.