My tax plan includes rate reductions in every major category of taxation. That’s a straightforward recipe for growth. Specifically, I want a 10% reduction in personal income tax rates, the state sales tax rate, and the corporation tax rate, and a 50% reduction in capital gains tax rates. Our analysis demonstrates that when other states have implemented tax rate reductions of similar structure and magnitude, government revenues have actually gone up, driven by increased economic activity and growth.
The government shouldn’t micro-manage the economy by picking winners. It should make everyone a winner. That means lowering tax rates to jumpstart economic growth and new job creation. The lower rates in my plan will let everyone keep more of their own money, and increase the incentives to work and invest.
Whenever conservatives call for major tax reform, we expect Democrats to argue that we can’t afford it. But it’s dismaying to hear some Republicans arguing for this..
There are Republican candidates in the California gubernatorial primary who have argued that California can't afford across-the-board tax cuts. But can California families afford to keep paying the highest sales tax in country? Can California businesses afford to keep paying our high taxes? Can California afford to lose more jobs?
These questions aren’t just for Californians. Our state is a lesson for rest of the nation. So far we’ve set a bad example. We’ve shown what comes from a tax system that’s one of the most liberal in the nation: an unemployment rate more than two points above the national average. As governor, I will lead the charge for broad-based tax cuts that I am confident will lead to an explosion in economic growth and job creation.
The bottom line is this: targeted tax cuts redistribute wealth; across-the-board tax cuts create it. That’s why President Obama is making targeted tax cuts part of his economic plan, and President Reagan made lower rates a cornerstone of his.
Any serious, conservative plan to create jobs in California must include meaningful changes to the tax system. Please join me in sending a message to both Republicans and Democrats: targeted tax cuts aren’t enough. We need real across-the-board tax cuts that reduce the tax burden on every individual and business in California.