Split Roll Tax Would Cripple Businesses in the Golden State

Wednesday, June 10, 2015

SACRAMENTO – Senate Republican Leader Bob Huff (R-San Dimas) responds to the “split roll” property tax proposal, formally known as Senate Constitutional Amendment 5 (SCA 5), describing it as a job killer for businesses that would drive many out of California.

If SCA 5 (Hancock-D and Mitchell-D) goes before voters and passes, it would weaken Proposition 13 by taxing commercial properties according to their market value but leaving limits on residential properties intact. By doing so, the property taxes on commercial and industrial properties would skyrocket. Voters passed Proposition 13 in 1978 by a nearly two-thirds vote. Since then, the measure has reduced property taxes on homes, businesses, and farms by about 57%.

Senate Republicans continue to fight for California families by pressing for responsible government which includes creating jobs, investing in California’s crumbling infrastructure and schools for our children, and not raising taxes on businesses or residents.

Senate Republican Leader Huff issued the following statement:

“There will be a ripple effect. Small businesses will be hit hard by this tax increase. They may pass on the cost to California families or take the loss and see if they can survive.”

“What California families need are good paying jobs, not new taxes on small businesses. Increasing taxes on employers by $9 billion dollars annually will mean less money to hire and retain workers. Taxing small businesses will not raise anyone’s wages, will increase consumer costs, and is likely to drive businesses out of the state.”

“Funding for our schools and local infrastructure is vitally important. California schools benefit when the economy grows.  Our recovering economy has raised funding for California K-12 schools and community colleges from $47.3 billion in 2011-12 to a high of $68.4 billion next year.  In the next three years, school funding is expected to grow another $6 billion. Clearly encouraging job creation is a better approach to fund education.”

SCA 5 will need a two-thirds vote in both legislative houses in order for it to be placed before voters on the 2016 ballot.

BACKGROUND: View the full language of SCA 5 HERE.