California Lawmakers Bracing For Coronavirus To Impact Budget
Sacramento, CA — While the public health response remains the top concern, California lawmakers are bracing for the impact of COVID-19 on the state’s budget.
The Associated Press reports that California gets nearly half of its income tax revenue from the top 1-percent earners, and capital gains are taxed the same as income. The recent stock market dive could create challenges for California, which has the world’s fifth-largest economy. Governor Gavin Newsom is planning to release a revised budget proposal this May for the fiscal year that begins July 1st. Democratic Assemblyman Phil Ting says the state is on a path to miss its revenue projections, and says COVID-19 could be what spurs the next recession. Some other lawmakers, however, are pointing out that California still has an estimated $18-20 billion reserve fund to utilize in the event of an extended downturn. The state has a $222-billion annual budget.