Lawmakers Reintroduce Wealth Tax Proposal
A proposed “extreme wealth” tax revives the controversial proposal from 2020 and uncertainty over federal stimulus delays discussions on a bill to allow PPP deductions.
California lawmakers introduced the California Tax on Extreme Wealth, a legislative package that revives the controversial proposal from 2020. Newsom also signed a new COVID-19 paid sick leave bill into law.
California extreme wealth tax proposal
On March 15, 2021, Assemblymember Alex Lee introduced a new state tax on wealth, known as the California Tax on Extreme Wealth. The legislative package would put a measure on the ballot for a 1% tax on households with a net worth of more than $50 million and a 1.5% tax on households with a net worth of more than $1 billion.
Democratic lawmakers and the California Federation of Teachers are supporting the proposal, which would reportedly raise an additional $22.3 billion a year in tax revenue. The package of bill would require a two-thirds vote in the legislature to put it on the ballot. Then the measure would need a simple majority from voters to pass.
The California Tax on Extreme Wealth follows last year's AB 2088, which would have imposed an additional 0.4 percent tax on net worth above $30 million or more than $15 million if married filing separately. Governor Gavin Newsom opposed the bill.
Newsom signs new COVID-19 paid sick leave bill
Governor Gavin Newsom signed into law SB 95, which would provide up to 80 hours of supplemental paid sick leave for employees, in-home supportive service providers, or personal waiver care service providers recovering from Covid-19 from January 1, 2021 through September 30, 2021.
The bill requires an employer to provide the sick leave if the employee or provider is unable to work or telework due to a quarantine or isolation period related to COVID-19; a health care provider has advised them to self-quarantine due to concerns related to COVID-19; they are attending a COVID-19 vaccine appointment; they are experiencing symptoms related to a COVID-19 vaccine; they are experiencing symptoms of COVID-19 and seeking a medical diagnosis; they are caring for family member; or they are caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.
Appeals court finds cannabis cultivation tax broadened impermissibly
The First District Court of Appeals ruled in their favor on all issues upheld a state trial court’s opinion that amendments to a commercial marijuana cultivation tax in northern California had impermissibly broadened the scope of the tax. In 2016, Humboldt County voters approved Measure S, a cannabis cultivation excise tax. The measure allowed the county to amend the tax as long as the change did not increase the amount of the tax or broaden its scope. The court found that 2017 and 2018 amendments expanded taxable property from cultivated areas to all areas permitted for cultivation and broadened the tax to include people who have obtained a permit but have not started cultivating marijuana under that permit.