THAT’S DEBATABLE:

Gov. Schwarzenegger wants to close many tax loopholes to fetch up to $2.5 billion to help offset the state’s projected $16-billion deficit.He said the money could take some of the pain out of the proposed $4.4 billion in projected cuts for schools that educators argue could lead to teacher layoffs and bigger classes. What do you think of the proposal? Are there any tax loopholes you could support closing?

The vast majority of these so-called “tax loopholes” are in the tax code for a reason. Proposed “loophole” tax increases include increasing the gas tax by 10 cents a gallon and then indexing it to inflation.

These big tax increase ideas come at a time when California ranks a dismal 47th in the nation in its business tax climate, just in front of New York, New Jersey and Rhode Island.

One unintentional “tax loophole” that should be closed is returning to the one-year period that large boats, jets, and luxury RVs have to be out of state to avoid paying sales tax. A car or a small boat bought by a middle-class taxpayer should be taxed the same as a yacht. This change will raise a little more than $20 million per year, though, making it more symbolic than a real fix for our chronic overspending.

Chuck DeVore

Assemblyman

(R-Newport Beach)

What seems to be lacking in much of the discussion regarding closing tax “loopholes” is an accurate definition of what is a tax loophole. According to the non-partisan Legislative Analyst’s Office, a tax loophole is a benefit provided to certain groups of taxpayers and/or an incentive to encourage certain types of behavior and activities. Perhaps the best known examples of these so-called loopholes are the mortgage interest deduction, dependent care credit, and research and development credits for California companies. Both the dependent care credit and the research and development credit have been specifically targeted for modification in the Legislative Analyst’s Office’s alternative budget proposal. These modifications, if adopted, would amount to nothing more than a tax increase.

Earlier this year the governor recognized that the state had a spending problem, not a revenue problem. New taxes will not solve the problem of the state’s chronic deficit. If taxes are used as a solution, income taxes will have to be raised roughly $1,000 for every taxpayer in California to pay off the state’s debt. In order to “kick” the state’s out-of-control spending addiction, the governor and the Legislature should identify wasteful government expenditures and make the necessary cuts. We should require each government agency to account for every dollar that they receive. We should sell unused surplus property owned by the state.

For the reasons stated above, I cannot and will not support any type of tax increase and that includes closing any so-called tax loopholes. Why raise taxes when we can solve the state’s budget crisis by simply reducing the amount that the state spends? It’s really that simple!

Tom Harman

Senator

(Huntington Beach)

As a matter of principle, it is better to spend less than tax more. Unfortunately, most Sacramento politicians don’t understand that. I believe individuals should be allowed to keep more of their hard-earned income to spend as they see fit rather than having government collect more for itself.

Californians are taxed at an outrageously and unfairly high rate compared to the residents of our neighboring states. That is because the spiraling deficit problems led to arbitrary, haphazard, and massive tax hikes by Sacramento politicians – and to paraphrase President Reagan, “Here they go again.”

From education to sanitation, we must ensure that individuals can keep more of what they earn rather than less.

Therefore, I suggest that for at least one year, there must be a moratorium on any new taxes. To bring this budget into balance, it must be done with budget cuts rather than tax increases.

California needs to cut the cost of incarcerating illegal immigrant felons (my recently introduced AB 2141 would do just that), make our state conform to President Clinton’s federal welfare reforms and end the in-state tuition to illegal immigrants before even considering another batch of arbitrary, haphazard, and massive tax hikes.

Van Tran

Assemblyman

(R-Costa Mesa)