Prop. 15: Business Property Taxes

Source: CALMatters

WHAT WOULD PROPOSITION 15 DO?

Hike property taxes on big businesses, raising billions for schools and local governments.

Now, owners pay property taxes based on the price they originally paid for that real estate — typically a lot less than what it’s worth today. If this measure passes, property taxes for many large businesses would be elevated to the property’s current, probably higher, market value. That would net $6.5 to $11.5 billion — 60% for cities, counties and special districts, and 40% for schools and community colleges.

Not (directly) affected: homeowners, and businesses with under $3 million in California property. Farm land would be exempt. An analysis by the nonpartisan Legislative Analyst’s Office wasn’t able to determine whether the buildings and other improvements on that land would be too.

WHY AM I VOTING ON THIS?

Back in 1978, California voters famously passed Proposition 13 — a huge permanent tax cut for landowners. It amended the state constitution to reset property taxes based on the purchase price of a home or business, and capped how much the tax could increase each year after that.

To strip businesses of this protection, a majority of voters must approve Prop. 15 — amending the constitution again.

Supporters say:

Prop. 13 has provided a massive break to some of the state’s larger businesses. If this passes, a small fraction of those would pay the vast majority of the higher taxes. All that money would go to cities, counties and school districts — and these days, they could really use it.

Opponents say:

It would be senseless to pass one of the biggest tax increases in California history in the middle of a cataclysmically bad recession. And while small businesses are technically exempt, large landlords may end up passing the costs to some of their tenants and customers.

 

WHO’S FOR IT:
Joe Biden and Gov. Gavin Newsom
California Teachers Association
California Democratic Party
Mark Zuckerberg

WHO’S AGAINST IT:
California Chamber of Commerce
California Retailers Association
Howard Jarvis Taxpayers Association
California NAACP

 

 

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By: CALMatters
November 13, 2020

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