Who pays taxes

Every California taxpayer should know who really pays taxes. Corporations do not pay taxes, fees and other government charges. Taxpayers pay.
Think of it this way: you have a small business. The city charges you a new fee  which takes most of your profit. You have to decide whether to go out of business or pass the cost of the new fee on to your customers. It’s an easy decision if you wish to survive. The same principle applies to big business. Their first obligation is to survive. Next is to provide reasonable return to their shareholders. Their decision is easy also: Pass new costs onto their customer. You and me, or leave California. Taxes are just another cost. So, don’t be indifferent to the additional costs government lays on corporations. The costs will ultimately be laid on you.
The same is true of the costs of government pensions. The only place that those costs can be recovered is from us, you and me, in the form of some kind of additional tax or taxes.
We have all heard that California has a program called cap and trade. Most of us think that it is just a program that affects corporations. It is a program supposedly designed to reduce climate change gases such as carbon dioxide. In reality, there is no mechanism to reduce those gases. The state has decided punishing corporations financially will make them reduce climate change gases. Talk about pie in the sky. The real purpose of cap and trade is to generate revenue for other programs. State revenues of about $700 million a quarter are allocated in this way. Twenty-five percent goes to the bullet train program, 20 percent goes to schools (pensions). The rest is up for grabs, to be spent as state wishes. The bullet train will not achieve significant climate change gas reductions.. It is a black hole, as is the public pension program. Retirement plans should be fiscally sound, fully funded at all times. They can’t pay benefits with money they don’t have. Right now, PERS and the teachers retirement program are about 70 percent funded. Taxpayers are about to take a big hit. At a recent meeting, managers of the public retirement programs decided that they would change the amortization period for unfunded liabilities from 30 years to 20 years. The payment  to reduce money owed for  unfunded  benefits will go up 35 to 50 percent. That’s thousands of dollars per employee to be paid by   cities, counties, the state and school districts to the pension fund. The only way they have to get money is from taxpayers, you and me. The alternatives are a great reduction in services to the community, increased taxes or the issuance of bonds, another tax. Or bankruptcy.
So if you’re a public employee or a teacher, don’t count on getting your retirement fully, if at all. Better start putting money away for your retirement.

Murray Bass,
Fairfield

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