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California propositions

Voters approve Proposition 55, which extends higher income tax rates for the wealthiest Californians

First-grade students at Vine Street Elementary School in Hollywood. (Al Seib / Los Angeles Times)
First-grade students at Vine Street Elementary School in Hollywood. (Al Seib / Los Angeles Times)

The wealthiest Californians will continue to pay higher income taxes as voters look to have approved Proposition 55.

In returns as of late Tuesday night, the measure led with more than 61% of votes counted.

"California voters have once again stood up for our children and schools in approving Proposition 55 to protect critical funding for education and keep vital services intact," Jennifer Wonnacott, spokeswoman for Yes on 55, said in a statement.

Proposition 55's passage means that single-filers earning more than $263,000 and joint-filers making more than $526,000 will pay a 10.3% tax on their income through 2030. Those making more than $1 million will pay the highest rate of 13.3%. The nonpartisan Legislative Analyst's Office has estimated that the higher tax rates will raise $4 billion to $9 billion a year, depending on the economy and stock market.

Voter approval of Proposition 55 continues the state's reliance on the wealthiest Californians to fund a significant amount of services. The richest 1.5% of taxpayers paid $33.9 billion in income tax revenues last year, a substantial portion of the day-to-day operating budget.

The higher tax rates were first implemented in 2012 when voters approved Proposition 30 during a time of severe budget crisis. Under the measure, those rates were set to expire in 2018. 

Since Proposition 30 passed, the state's revenues have improved dramatically, but Gov. Jerry Brown warned of future deficits unless Proposition 55 was approved. 

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