One place you are not likely to hear any complaining regarding gas prices is the California legislature and the Governor's office. "Why", you may ask. Well, because with every increase of the per gallon price, there is a correlating increase in tax revenue.
In a recent conversation with the all knowing oracle of trivial information (an unnamed uncle of mine), he related how there is also a sales tax per dollar above and beyond the excise taxes which are on each gallon. This I did not know. In California, there is an 18 cent per gallon state excise tax, another 18.4 cent Federal excise tax, the sales tax, and some other 1 cent federal deal.
So, with an increase in gas prices, California actually adds to the coffers with the new jackpot of gasoline taxes with the typical 7.25% per dollar sales tax.
Now, Assembly Democrats are rushing to fill the endless abyss in its appetite for spending by creating a bill to increase taxes on the one thing that is a necessity for most - oil and gas. Yes, we are in a huge budget crisis in California, thousands losing their homes, prices for everything are going up, teachers are getting laid off...I know, we can solve the whole thing with...(triumphant horns blaring)...NEW OIL TAXES.
Yes, that is right boys and girls. You have not felt enough pain. Forget the gross mismanagement of funds and revenue - you are not paying enough. Is this one of those
Bustamante "tough love" scenarios?
Unbelievable!
Capitol Weekly reports:
The bill would create a new 2 percent oil tax for any oil company that earns more than $10 million in net income. It would also impose a new 6 percent “oil severance tax” based on the gross value of each barrel of oil produced in the state.
DeVore said the proposal would "devastate oil production in California if it’s passed," and would lead to an increase in Calfornia's gas prices, despite language in the bill that specifically prohibits oil companies from passing the cost of the new tax on to consumers.
The bill language was introduced Monday, and is being fast-tracked by the Speaker’s office. It is scheduled to be heard in Assembly Revenue and Taxation Wednesday, and on the Assembly floor some time this week, right before the Legislature adjourns for spring break.
Yeah, no doubt it is being "fast-tracked". Get it in under the radar as fast as possible. Have these people been hanging out on
New York Ranch Road?
It is like I always say, "Anybody that thinks that corporations pay taxes is a moron." And I say that without reservation.
Corporations do not pay taxes - people pay taxes. I know it is a new paradigm, but try to align your brain cells for a minute. If a tax is levied on a company or an industry and it is in that company's best interest to make a profit instead of going under and filing for bankruptcy, the company reprices their product to reflect the cost of doing business. It is that simple.
If a company does not make profit, then a company dies. Nobody, except the Federal government, would be willing to invest in a company that cannot make a profit. There is no incentive and no reason.
So, if the law states that the company cannot pass on the new taxes, what do you think will happen to that new company? Hmmmm....I know. Perhaps, they will substantially reduce their production to meet profit goals, or...they will leave the state.
Some may shout "Good! We don't want those slimy oil companies here anyway." Well, you are a moron or you have a political agenda that is far left of the ACLU. If you think the cost of goods is high now, wait until oil production and all by-products (gasoline, HELLO!) have to be shipped here rather than produced here. Won't that be a dream come true.
All comments will be read with an open mind...of course.
