Consumers and vehicle owners in California received some rare good news from Sacramento on July 1, 2011: tax cuts. On that day, the statewide sales tax rate fell by one percentage point " a penny on the dollar" and the yearly vehicle license fee that drivers pay was lowered by 43%.
The expiring increases, which were placed in the books in 2009 as California creeped toward insolvency, will provide substantial savings for lots of people. Typically, a family of four will save over $1,000 a year when income tax increases that ended in January arefactored in, as outlined by Republican legislators.
"Within a year's time, I know I'll feel the impact on my pocketbook," said Mike Tanner, a 56-year-old retired phone company technician from South Pasadena.
The state sales tax reverts to 7.25%, though many cities add their own levies, and the good news spread across California: All items, a car, a couch, an ice cream cone, will soon cost less. Customers making big-ticket purchases will see the largest difference.
A new car buyer who scoops up a $25,000 vehicle, for instance, will spend $250 less in sales tax. And the lesser yearly vehicle charge falling from 1.15% of a car's worth to 0.65% on the new car will save the owner $125.
The budget that the governor authorized in July boosts vehicle registration fees by $12, but any owner of a car worth more than $2,400 will nevertheless experience a tax cut.
At Goudy Honda in Alhambra, General Sales Manager Michael DeVille has been working on creating an advertising campaign around the tax-cut buzz, planning to market the incentive on the internet and in newspapers. And every sales person has been imposed with informing every customer about it.
But like every other promotion, he anticipates this one will lose traction rather quickly as people will become used to the tax cuts. Then, he said, his salesmen will be hustling again just to make a sale.
In Sacramento, Republican lawmakers took a victory lap at a downtown Ford dealership. They declared a "Freedom from Higher Taxes Day" and patted each other on the back for their rejection to replenish the higher tax rates in budget talks this year, which was a top priority of Gov. Jerry Brown and Democrats in the Legislature, who wanted the levies to help balance the state's books.
"We kept politicians out of the taxpayers' wallets," said Assembly Minority Leader Connie Conway (R-Tulare), standing at a podium in the dealership parking lot.
Assemblyman Tim Donnelly (R-San Bernardino) said the disappearing taxes would be a benefit to a California job market that has gone stale at near 12% unemployment. "The death of these taxes is the rebirth of our economy," he said. Democrats disagreed. They said permitting billions in taxes lapse as California encounters a massive deficit amounted to governmental negligence. Lots of the steepest spending cutbacks they passed in the budget - suspending a program to help teen mothers, slashing welfare grants by 8% and
The expiring increases, which were placed in the books in 2009 as California creeped toward insolvency, will provide substantial savings for lots of people. Typically, a family of four will save over $1,000 a year when income tax increases that ended in January arefactored in, as outlined by Republican legislators.
"Within a year's time, I know I'll feel the impact on my pocketbook," said Mike Tanner, a 56-year-old retired phone company technician from South Pasadena.
The state sales tax reverts to 7.25%, though many cities add their own levies, and the good news spread across California: All items, a car, a couch, an ice cream cone, will soon cost less. Customers making big-ticket purchases will see the largest difference.
A new car buyer who scoops up a $25,000 vehicle, for instance, will spend $250 less in sales tax. And the lesser yearly vehicle charge falling from 1.15% of a car's worth to 0.65% on the new car will save the owner $125.
The budget that the governor authorized in July boosts vehicle registration fees by $12, but any owner of a car worth more than $2,400 will nevertheless experience a tax cut.
At Goudy Honda in Alhambra, General Sales Manager Michael DeVille has been working on creating an advertising campaign around the tax-cut buzz, planning to market the incentive on the internet and in newspapers. And every sales person has been imposed with informing every customer about it.
But like every other promotion, he anticipates this one will lose traction rather quickly as people will become used to the tax cuts. Then, he said, his salesmen will be hustling again just to make a sale.
In Sacramento, Republican lawmakers took a victory lap at a downtown Ford dealership. They declared a "Freedom from Higher Taxes Day" and patted each other on the back for their rejection to replenish the higher tax rates in budget talks this year, which was a top priority of Gov. Jerry Brown and Democrats in the Legislature, who wanted the levies to help balance the state's books.
"We kept politicians out of the taxpayers' wallets," said Assembly Minority Leader Connie Conway (R-Tulare), standing at a podium in the dealership parking lot.
Assemblyman Tim Donnelly (R-San Bernardino) said the disappearing taxes would be a benefit to a California job market that has gone stale at near 12% unemployment. "The death of these taxes is the rebirth of our economy," he said. Democrats disagreed. They said permitting billions in taxes lapse as California encounters a massive deficit amounted to governmental negligence. Lots of the steepest spending cutbacks they passed in the budget - suspending a program to help teen mothers, slashing welfare grants by 8% and
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