Sacramento Sends Californians Stimulus Checks Ahead of Fall Election; Newsom Vows To Punish Oil Companies With ‘Windfall Tax’
Sacramento’s elite are desperately hoping that Californians won’t notice inflation, taxes, or the gas prices.
Ahead of the November election, Sacramento decided to try and mitigate some of the damage being done to the Democratic Party brand between gas prices and inflation.
State politicians are sending out stimulus checks to Californians.
Up to 23 million California residents are about to receive tax refunds of as much as $1,050, thanks to one-time stimulus payments the Golden State began deploying Friday.
The payments, which will total $9.5 billion, mark the largest program of its kind in the state’s history.
The initiative, dubbed the Middle Class Tax Refund, comes as inflation nationally has reached historic highs. California had a record $97.5 billion surplus as it finalized its budget including the payments earlier this year.
“We know it’s expensive right now, and California is putting money back into your pockets to help,” California Gov. Gavin Newsom, a Democrat, said in a statement.
“We’re sending out refunds worth over a thousand dollars to help families pay for everything from groceries to gas,” he said.
However, some of that money is going to be going right back to Sacramento. The State of California has quietly raised its marginal income tax rate to 14.4% beginning in 2024.
It’s hard to keep track of the bad policy emanating from California nowadays, and maybe that’s what Gov. Gavin Newsom was hoping when he signed legislation on Friday that raises the top marginal income-tax rate on the sly. High earners won’t know what hit them until it does.
The bill funds an expansion of the state’s paid family leave benefit by removing the $145,600 wage ceiling on the state’s 1.1% employee payroll tax. Workers can currently receive a 60% to 70% wage replacement to take up to eight weeks off to care for a new baby or sick family member. Starting in 2025, they will be eligible for between 70% and 90% of wages, more for lower earners.
The 1.1% payroll tax had been limited to $145,600 in wages since benefits are capped at $1,540 a week. That means high earners don’t receive a commensurately larger benefit. But in progressive fashion, Democrats are removing the tax ceiling and dunning higher earners to pay for a benefit expansion that will mainly benefit lower earners.
This means that in 2024 California’s top marginal tax rate will increase to 14.4% from 13.3% for workers making more than $1 million. Those making between $61,214 and $312,686 would pay 10.4%. So California’s upper-middle class will pay more than millionaires in almost every state save New York, New Jersey and Hawaii.
The stimulus checks will also be for gas, as California’s average gas price is $6.42 a gallon – far above the national average of $3.86. Newsom is blaming the oil companies, and plans on nailing them with a “windfall tax.”
Gov. Gavin Newsom will call state lawmakers back to Sacramento for a special session in response to rising gas prices.
The session will take place on Dec. 5.
The governor has requested the Legislature approve a measure that would require oil companies to pay back excessive profits to consumers through a new tax. The Legislature finished policymaking for the year on Aug. 31 and can’t begin action on proposals until January, unless the governor calls the special legislative session.
Newsom said Friday he chose Dec. 5 because that is when the Legislature was already scheduled to reconvene briefly to swear-in new members. He said his office wants time to make sure the proposal is on solid, legal ground.
There are many reasons this idea is full of fail.
Phil Flynn, a FOX Business contributor and senior market analyst at the Price Futures Group, said such a windfall tax would “further discourage investment in an industry that is desperately in need of capital to stay in business in an increasingly hostile governmental environment.” he said.
..”There’s this false perception – created in part by politicians – that somehow energy companies are making too much money,” Flynn told FOX Business. “The truth is their profits are higher than they have been in the past, but they fail to put it into the perspective of how much these companies have to invest to bring supply to the marketplace, and it fails to take into account the government regulations that have restricted supply that have caused the prices to go higher as well. It also doesn’t take into account that most of these energy companies in the past were losing money just a few years ago.”
Flynn told FOX Business the windfall tax Newsom called for is a “tool to shift blame” onto oil companies “that are just trying to do their job and keep the market well supplied.” It would restrict supply and make prices rise in the long run, he said.
As noted, it is difficult watch a state commit suicide. It’s a lot harder when you are a resident of that state.
Watching a state commit suicide before our eyes! #California #Oil #Gasoline
Gov. Newsom will call a special legislative session to impose a windfall tax on oil companies https://t.co/CPhJgwt04s
— Anas Alhajji (@anasalhajji) October 7, 2022
Sacramento’s elite are desperately hoping that Californians won’t notice inflation, taxes, or the gas prices, but voters in the rest of the country probably do and are likely to vote their pocketbooks.
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Comments
Progressives and ecofascists love to conflate “earnings” with “profits.” They are not the same thing. One is before costs are deducted and one is after they are deducted.
This bait and switch is a bad faith dodge to avoid acknowledging the skyrocketing costs of raw materials, skilled and unskilled labor, and regulatory compliance, all of which are the fruits of failed progessive policies.
Gee, bribe voters much?
California: spraying gasoline on a four alarm house fire. Yeah, this’ll end well.
If a gov’t has a “surplus,” then it is taking too much money from its taxpayers.
Of course it is a bribe, with their own money. And Californians being Californians they lap it up thinking that they have died and gone to heaven. Which for a Leftist, they have.
Given that the sovereign power of the State is now at war with the entire petrochemical industry from drilling all the way to exhaust fumes, things are not going to get better for them. So just as a thought, since the State is going to insist that they lose money at every one of those steps; that one or more of the companies [and maybe all of them] start shutting down operations in California. From pumping crude out of the ground to refining, to retail sales. It will reduce their losses. Since I do not believe that the infrastructure exists [or if it does, it won’t for long] to get the petroleum from California to America, shutting down is the only alternative. The trucking industry cannot move petrol out in sufficient quantity, and indeed it is being shut down by the State. Trains cannot do it and may themselves find that it is better to operate in America. I don’t think that there are eastbound pipelines to move the petroleum, and even if there were the State would seize them.
Of course if they have a way to get oil, refined or otherwise, to our country; let them do it. But California will insist on its revenge for reality striking. So shut down.
Now, if we could only keep Colorado River water out of southern California.
Subotai Bahadur
I forgot to add this:
“This means that in 2024 California’s top marginal tax rate will increase to 14.4% from 13.3% for workers making more than $1 million. Those making between $61,214 and $312,686 would pay 10.4%. So California’s upper-middle class will pay more than millionaires in almost every state save New York, New Jersey and Hawaii.”
How many of those productive and eminently taxable citizens will decide that life and business would be better outside California? A certain percentage will, and that will inflict even more reality on California. Mind you, some of them will be trying to reproduce California in their new homes.
Subotai Bahadur
Can they write those taxes off against their federal income tax? Serious question as I live in a no state income tax place and don’t know how that works.
The first $10,000 of state and local taxes is deductible from ones income for federal income tax. Anything over $10,000 is not deductible. The Dems have made it a high priority to repeal that cap.
“Mind you, some of them will be trying to reproduce California in their new homes.”
Just like Muslins do in western countries, they leave a shit-hole and then try to recreate it.
It would be a lot easier to leave CA if when looking for alternatives, I see mostly states who are five years or less from being CA themselves (sanctuary cities?) and insist 0n blaming CA for their problems. I know, I’ve been saying this for 10-15 years and no one is listening. The opportunity to kill this would have been 20 or so years ago when CA was the only one fighting and all you virtue signalers could do was mock us and tell us we deserved it. Now that the shoe is on the other foot, you people still can’t admit the real problem. No sympathy here.
You people deserve what you are getting. You weren’t willing to help those of us who were fighting it when there was time and you still won’t fight it. Yeah, let’s bus them to CA (most of them are and have been coming in from no-wall TX and no-wall AZ) and teach them a lesson is all you can ever say. Meanwhile, your cities are at least as bad as ours and more of your voters are leaving than they are here in CA. See the problem? Do you think you could be making friends instead of doubling down on why things are the way hey are? I’m not holding my breath. This is a case where a collapse is the only thing that will wake people up.
Phil,
Come to rural Bama but leave the CA entitled attitude. The world doesn’t owe you understanding or anything else, nor does anyone in it owe you jack squat.
In rural Bama people are neighborly but not intrusive. No one is going to jack your car but in the unlikely they do and you were to successfully defend yourself then you will be fine. We appreciate folks who solve their own problems and don’t mind lending each other a helping hand, as long as someone doesn’t demand we do it.
You read entitlement in my attitude? No! I am expressing the frustration I felt going all the way back to when CA was a red state in 1989. This was Reagan country. And even then out-of-state Republicans were attacking CA for being CA. We were successfully fighting illegal immigration, passing laws like Defense of Marriage and making them stick, Proposition 13 keeping government spending in check, and much more. But the rest of America just hates CA, one of the most beautiful places in the world to live and once the ENVY of the world. in my lifetime! The Democrats didn’t destroy CA, corrupt neocon Bush Republicans did! And now your response is go to Alabama and leave my CA attitude behind?
CA used to have the best education system in the world and now the only states worse than CA are Alabama and Mississippi. Yes, cost of living is lower but so is the quality of life. Give me a break will you? The answer is always to run away to some backwater state whose main industries are government programs like defense contractors and military bases?
Where ever I am end up, believe me, I am not bringing my “California attitude”. I’ve already lived through the decline of CA and I don’t plan to relive it again at another open-borders, cheap labor, too-corrupt-to-have-decent-schools state. I will be bringing my winning attitude. My MAGA attitude! AL could use some “Make Alabama Great For Once!” attitude. There is a reason why Alabama is perennially almost dead last in everything.
If you still don’t get what I’m saying, and I would apply that to most of you California haters, what ultimately happened to CA happened elsewhere first. My own hometown is unrecognizable. With all of the years Rush Limbaugh was on the radio, has anyone even once listened to his theme song?
https://duckduckgo.com/?t=ffsb&q=rush+limbaugh+theme+song&atb=v320-1&iax=videos&ia=videos&iai=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DuTLcZDY9pzs
Do you think he chose that song because of the beat? NO!
CA is THE HIGH GROUND for the battle of America. What happened here was imported from the rest of the country. I don’t defend what CA has become. But I also don’t think much of a country where Alabama is the “golden state”. There are plenty of places in the world that have similar values as AL. Family values are universal. “Leave me alone” is also a universal wish. But it was only accomplished here in the US where 4% of the world’s population rose to dominate the rest of the world. Alabama contributed to this not by leading the way but with going along. No one needs to fight for Alabama. Everyone is free to go there but few choose to.
CA was worth fighting for but the rest of the country abandoned the greatest state of all. We were what all of America aspired to. But jealousy, envy and the petty politics of provincial attitudes destroyed it. All imported into CA. So where are those whose ancestors made this state the envy of the world advised to go? Alabama? Mississippi? North Dakota? Idaho? Why not Costa Rica? If you really want to experience “Leave me the F alone!”, go to Alaska.
So get my point? Get into the REAL fight. An American without a free California is not worth fighting for. So those who continue to pile on to CA for sport, what happened here started where you are and is now all around you. Are you going to run away again?
Petroleum companies should direct all of California’s supplies to other states, doing so would break California’s back. It is a war, treat it like one.
And, they should let California voters know that the reason their gas prices aren’t coming down is that they are paying the super-tax their governor just applied on their gas.
If oil companies aren’t headquartered in California, how are they supposed to be taxed? And couldn’t the companies simply put a surcharge on Californian fuel in preparation for Newsom’s ‘windfall tax’? If customers see how much Newsom is going to cost them, they may loudly protest. This needs to be done before the November election however, not waiting until just after it as Newsom intends to do to avoid damaging Democrat election chances.
Vaguely recall from tax work in a previous life that many states apportion their share of a corporation’s fed. taxable income based on a variety of factors.
Such as % in-state of total revenue, % of assets located in the state, or % of payroll.
Factors that can be shifted elsewhere if California insists on asserting enough fiscal pain.
“It was self-serving politicians who convinced recent generations of Americans that we could all stand in a circle with our hands in each other’s pockets and somehow get rich.”
~ Paul Harvey
https://twitter.com/ZavalaA/status/1578541331340673024/photo/1
CA Dems demand to know why gas prices are so high, so energy company Valero takes them to school
NEW: VALERO responds to California’s demand for answers recent gas price spike.
“As demanded with one business day to respond…”
“California is the most challenging market to serve in the United States for several reasons.”
Copy of letter at link
Valero reduces inventories in a tight market. What a revelation. I wish that he had prefaced that remark with this, “Following the precedent of FJB drawing down the Strategic Petroleum Reserve in a tight market, Valero …..”
Literally insane. California already has the single highest gas prices in the country because the state ALREADY ADDS over a freaking DOLLAR per gallon of tax.
I’ve said it before, I’ll say it again.
California is going to see $10 gas in the very near future – I wouldn’t be surprised by the end of the year.
If a stock goes up, the shareholders ought to have the rise all taxed away. Makes it hard to sell stock though.
My ballot is again infested with various school bond measures which like always, are almost certain to pass. Yet the schools are always claiming to be underfunded since that money never seems to reach the classrooms (except for teacher pay). Meanwhile, administration budgets continue to find more and more money to administer fewer and fewer students.
In the old private sector (before the government started interfering with their endless bailouts), this would have resulted in bankruptcies and corporate take-overs. Now both government and private sectors are populated by zombie parasites feeding on the shrinking population of competent, efficient producers. Good-bye civilization!
BTW, another reason why Gov Hair Gel and his ilk have no chance moving forward:
https://www.breitbart.com/politics/2022/10/08/watch-live-former-president-donald-trump-holding-save-america-rally-in-minden-nevada/
No one ever points this out but a big reason why Trump is dominating is that he goes where the votes are. He is only one who stoops to meet city neighborhood voters directly. He intentionally bypasses establishment gatekeepers to make himself accessible. What can the race-mongering “reverends” do about it when Trump keeps cutting into that vote? Nothing.
Trump also does the same thing for farmers as per the link. In fact, that is his modus operandi. He makes himself accessible to the hoi polloi and connects with them face-to-face without teleprompters or prepared notes. No one else does that. No one. Trump is the real deal which is why he will win.
If Hair Gel wins the Dem nomination, it will only be because the Dems know they can’t win and will offer him as their sacrificial candidate. I doubt either the Clintons or Obamas want to lose in 2024 so….
Has anyone seen Gavin Newsome and Justin Trudeau in the same room at the same time?
Doesn’t the guv-boy know that petroleum is a major ingredient of his hair gel? Where would this smirking, self-satisfied, sleaze ball be with frizzy, lifeless hair and split ends?
Someone forgot to add “a week’s worth of” before groceries in the copy.
It doesn’t take a lot of brain cells to realize that every dime you tax a gas company comes right out of the pockets of their customers. And California is taxing a lot of dimes.
Newsom: We’re raising taxes on gas companies to save you money!
People: Yea!
Gas companies: Prices just went up another dollar.
Newsom: We’re raising taxes on gas companies even more to get that dollar back.
People: Yea!
Gas companies: Ok, prices just went up two dollars. Want to try for three?