California Legislature To Take Up State Universal Health Care

Photo by: BJ Hansen

Sacramento, CA – A bill that could bring the nation’s first universal health care system that was on life support got a new jolt yesterday after California Democrats proposed tax hikes on some businesses and the wealthy to pay for it, bringing strong opposition from the health industry and Republicans.

San Jose Assemblyman Ash Kalra proposed an amendment to the state Constitution that would impose an annual tax of 2.3% on businesses with at least $2 million in annual revenue. There would also be a 1.25% tax on the payroll for companies having at least 50 employees and a 1% tax for employers who pay workers at least $49,900.

The series of tax hikes on wealthier people starts with a 0.5% levy on the income for those who make at least $149,509 per year and ends at a 2.5% income tax on more than $2.48 million annually. Opposed to the bill is the California Taxpayers Association arguing it would increase tax collections by $163 billion per year. Also, against the plan are some of the biggest lobbying groups in the state, including the California Chamber of Commerce, the California Hospital Association, the California Medical Association, and the aforementioned taxpayers association.  All of those groups on Thursday condemned the plan and urged lawmakers to reject it.

Making the tax increases law could be a heavy lift as at least two-thirds of the state Legislature would have to approve them. Then, voters would have to give the green light as well in a statewide referendum, possibly this November. Democratic leaders scheduled a hearing on the bill next week. It is expected to make it to the Assembly floor as Assemblyman Jim Wood, the chair of the Assembly Health Committee declared he will vote yes.