2011 Tax Relief

During the 2011 budget debate, Assembly Republicans stood together to reject the $58 billion tax increase proposed by Governor Brown and majority Democrats.

As a result of the defeat of the Democrat tax increase proposal, the average family of four saw their annual tax burden drop by $1,040 on July 1 as a result of the expiration of the 2009 tax increases.

Here's how this tax relief benefits you and your family:

  • Lower State Sales Taxes - State sales taxes were lowered by one cent, which the Board of Equalization estimates will be a $233 savings for the average California family. 
  • Lower Car Taxes - The car tax (vehicle license fee) was dropped nearly in half, from 1.15 percent of the vehicle's value to 0.65 percent.  Based on the purchase of a $20,000 new car in Sacramento County, car buyers would see $200 in sales tax savings and $100 in lower car taxes.
  • Lower Income Taxes - On January 1, 2011, each state income tax rate was lowered by 0.25 percent.  It is estimated that joint filers making $50,000 per year in taxable income will save $125. 
  • Restored Child and Dependent Care Credit - The Child and Dependent Care Expenses tax credit was also restored to the pre-2009 level of $309 per dependent, with eligibility based on income levels, which is an increase of $210 in tax savings per dependent. 

Californians have already put these tax savings to good use by spending it - helping to boost our struggling economy at the same time.  This has especially benefitted car dealers and other small businesses that have been desperate for new customers in these tough economic times.

The nonpartisan Legislative Analyst recently forecast that sales tax revenue will grow next year by 7.8 percent and income tax revenue will grow by 4.5 percent - thanks to this critical tax relief helping to boost our economy. Keeping taxes low is essential to efforts to bring back employers and get Californians working again.