California Senate Bill 43: Taxing the Poor

California Senator Ben Allen (Santa Monica) introduced SB 43 back in December, and the bill is now set for hearing on March 20, 2019.

What the Bill Says

This bill would require the state board [State Air Resources Board], in consultation with the California Department of Tax and Fee Administration, to submit a report to the Legislature on the results of a study, as specified, to propose, and to determine the feasibility and practicality of, a system to replace the tax imposed pursuant to the Sales and Use Tax Law with an assessment on retail products sold or used in the state based on the carbon intensity of the product to encourage the use of less carbon-intensive products.

* This bill is being presented as only a study. However, whatever the study comes up with, it would be logical to assume if legislators want to approve it and the Governor wants to sign it, there we have it.

* The study aims to determine how the current sales and use tax on goods – which needs voter approval for increases — could be replaced by an “assessment” on goods depending on their carbon intensity. Would an “assessment” need voter approval for increases?

* Common sense would most likely conclude that such an “assessment” on the carbon intensity of each product consumed by California residents would cost a bundle to implement and maintain, could result in endless argument and litigation, and would need to include a lot of guesswork. How would the Air Resources Board assess a child’s scooter manufactured in China containing a wooden platform, metal and rubber wheels, plastic handles, and colorful paint? What happens when the scooter manufacturer decides to replace the wooden platform with a plastic one?

Likely Results

* Assessments will be whatever bureaucrats say they will be.

* As with most taxes, the poor will once again be hurt the most.