We, The Taxpayers
California’s arcane system of state and local taxes hits every household differently. To gauge the bite, The Times asked a cross-section of Southern California residents to pull out their tax returns and talk about the system. To make it easier to compare these tax bills to your own, the stories are color-coded with the charts shown here, which provide several measures of tax bite and after-tax wealth.
Income Groups Defined: Using Franchise Tax Board data for 1970, 1980 and 1990, The Times divided tax-paying households by income into five groups of equal size. In 1990, the groups were defined this way:
WALTER PRINCE: Upper (Top 20% of earners) $50,001 and Over
AGE: 57
WHERE: Northridge
JOB: Janitorial firm owner
1992 INCOME: Profits of $65,919 from his business
1992 STATE AND LOCAL TAXES: $4,132
VIEWPOINT: “Individual property owners feel they have been cheated . . . because they didn’t buy property in 1978. But prices change. Taxes are no different from a quart of milk or a loaf of bread.”
Walter Prince just wants his money’s worth.
“If I walk into a market and buy a pound of meat for $5, I want the full pound,” the San Fernando Valley businessman says. “With the government I think I’m only getting a half pound. That does make me angry.”
Property owners--Prince owns about 20 commercial properties in Los Angeles County and Executive Suite Services, a janitorial firm with 200 workers--are the “scapegoat and the beast of burden” when elected officials need to raise more money, he says.
He cites the example of a proposed new assessment by the Los Angeles County Flood Control District. Everyone benefits from flood control--not just land owners--and everyone should help pay, he says.
If there were a need for more revenue, Prince says, policy-makers should look to higher sales and use taxes. But there is no need, he contends: “I don’t think more taxes are necessary. I think we have to find somebody who is wiser spending the tax money we have.”
Proposition 13, he says, was one of the state’s wiser moves. “In the long run, Prop. 13 helps the state because the old-timers who have lived in their houses for a long time are happier. They’ve got a tax bill they can live with.”
WHAT HE PAID
State income tax: $657
Property tax: $2,635 (residence)
Est. Sales Tax: $840
State and Local Taxes as a Percentage of Income: 6.3%
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Data analysis by Richard O’Reilly, Times directoy of computer analysis, and Times researcher Nona Yates from Franchise Tax Board, California Department of Finance and State Board of Equalization data.
