High (Tax) Times in California?
It is going to be a long hot summer in California’s capital as negotiations heat up over what Gov. Arnold Schwarzenegger in late April projected to be a $20.2 billion budget deficit for next fiscal year, starting July 1. Because a two-thirds majority is required to pass the budget, some Republican support is needed, but Schwarzenegger, the state’s top Republican, is moving in the direction of tax increases and he could drag Republican legislators with him. California’s fiscal conservatives are worried that the legislature will not pass any meaningful budget reform in exchange for higher taxes.