Assembly OKs Sales Tax Cut; Wilson Vows Veto

Over Republican objections, the Democratic-controlled Assembly on Monday approved a quarter-cent cut in the state sales tax rate, sending the measure to Gov. Pete Wilson, who vows to veto it.

The lower house approved the measure on a 54-6 vote, with several Republicans in the 80-seat house not voting.

The Democrats’ plan, pushed by Assembly Speaker Antonio Villaraigosa, is for a one-year reduction of the sales tax to 5.75%, from the current 6% on items other than groceries and prescription drugs.

Statewide, the quarter-cent cut would pare about $955 million from the state budget. But few Californians would notice: A $100 purchase would cost 25 cents less. About a third of all sales tax is paid by business.

“The governor will veto it faster than a plane taking off from LAX,” said Sean Walsh, Wilson’s press secretary. “It is not a meaningful, permanent tax cut. It’s a laughable tax cut.”

The vote came as Wilson and the Legislature enter the second week of a budget impasse. The state Senate approved the quarter-cent cut last week.

“We all know what this bill is--an attempt by the Democrats to put themselves on the side of the taxpayers,” Assembly Republican Leader Bill Leonard of San Bernardino said. “It’s not a very large cut. It’s not a very long cut. . . . This is wholly inadequate.”

The Democratic proposal is a “mere table scrap tossed to the taxpayers,” Assemblyman Tom McClintock (R-Northridge) said, charging that Democrats want to engage in a “gluttonous orgy of spending.”

McClintock and other Republicans continue to embrace a cut in the annual tax that motorists must pay to register their vehicles.

Wilson is pushing for a 75% cut in the car tax, which would save owners an average $128 a year. Altogether, Wilson’s proposal would cut taxes by $3.6 billion a year.

“This is our genuine effort to find a middle ground,” Villaraigosa told Republicans. “The ball is in your court.”

Assemblyman Jim Morrissey (R-Anaheim), attempting to embarrass Democrats, proposed that the Assembly remain in session each day until a budget is in place.

Several lawmakers seemed taken aback when Villaraigosa endorsed the idea, but it passed 70-1.