California’s $16 Billion Tax Avalanche: How Sacramento’s Spending Crisis Became Your Problem
The Bill Comes Due
California legislators have introduced proposals for more than $16 billion in new annual taxes and fees—a staggering sum that, according to the California Tax Foundation, spans 71 separate bills targeting everyone from homeowners and small business owners to drivers filling up at the pump. This isn’t just another Sacramento spending spree disguised as fiscal responsibility. It’s a calculated attempt to paper over years of unchecked government expansion by reaching deeper into the pockets of ordinary Californians who are already struggling with the nation’s highest cost of living.
The timing couldn’t be more revealing. These tax proposals arrive just as Governor Gavin Newsom touts a “balanced budget” while simultaneously presiding over chronic deficits that even his own administration can’t accurately forecast. What California faces isn’t a revenue problem—it’s a spending addiction that state leaders refuse to acknowledge, let alone address. And now, after years of explosive government growth, Sacramento wants taxpayers to foot the bill for their fiscal irresponsibility.
For Californians who value limited government, fiscal accountability, and the fundamental principle that government should live within its means just like families and businesses must, this $16 billion tax blitz represents everything wrong with one-party rule and unchecked progressive governance.
The Numbers Don’t Lie: California’s Spending Explosion
To understand why Sacramento is frantically reaching for taxpayers’ wallets, you need to see what they’ve been doing with your money. Since Gavin Newsom took office in 2019, California’s state budget has exploded by over 63 percent—surging from approximately $200 billion to $348.9 billion in just seven years. That’s a $150 billion increase in government spending during a period when California’s population has essentially flatlined.
Let that sink in: California’s government spending grew by 63 percent while the state’s population barely budged. According to the Hoover Institution, this spending growth far outstripped inflation and population increases, revealing a government that expanded dramatically without any corresponding increase in the number of people it serves.
What did Californians get for this unprecedented spending spree? Higher homelessness rates. Crumbling infrastructure. Failing schools. Rising crime in major cities. An energy grid that can’t handle summer demand. And now, a chronic budget deficit that state officials estimate anywhere from $3 billion to $18 billion, depending on whose math you trust.
As Dave Kline, spokesperson for the California Taxpayers Association, pointedly observed: “It would be tough for taxpayers to look around and think all of the services have improved to the same extent as spending has gone up.”
The Tax Foundation’s Warning: Third Worst in America
California taxpayers already shoulder one of the heaviest tax burdens in the nation. The Tax Foundation’s 2026 State Tax Competitiveness Index ranks California 48th out of 50 states—meaning only New Jersey and New York have worse tax climates. The state’s combined state and local per capita tax burden stands at $10,319 annually, ranking third-highest in the nation behind only Washington D.C. and New York.
California maintains the highest top income tax rate in America at 13.3 percent. It imposes the highest state gas tax in the nation, with another automatic increase scheduled for July 1, 2026, thanks to legislation that ties fuel taxes to inflation—a clever mechanism that raises taxes without requiring politicians to cast an unpopular vote. And soon, Los Angeles County residents may face a combined sales tax rate of 10.25 percent, among the highest in the country.
As Jared Walczak, a senior fellow at the Tax Foundation, explained: “The overall picture is one of high taxation and taxes that don’t exist in other states.”
Yet for California’s progressive lawmakers and special interest allies, this still isn’t enough. They want to be number one—not in quality of life, business climate, or public services, but in tax burden. The $16 billion in proposed new taxes and fees represents roughly a 5 percent increase over current tax collections, piled atop an already crushing load.
What’s in the $16 Billion: Targeting Everyone
The beauty of California’s proposed tax blitz, from Sacramento’s perspective, is its comprehensive scope. These aren’t narrow, targeted levies on specific industries—they’re a dragnet designed to extract money from virtually every corner of the California economy.
Among the 71 bills identified by the California Tax Foundation are proposals to:
- Increase personal income taxes on individuals and families already paying the nation’s highest rates
- Raise business taxes, including AB 1790’s “water’s-edge” election change that would subject California businesses to state taxation on foreign income earned anywhere in the world
- Create new employer penalties tied to workforce metrics, such as how many employees rely on government health coverage or pay-ratio triggers based on CEO-to-worker compensation gaps
- Impose additional sales taxes in multiple counties, including Los Angeles, San Francisco, San Mateo, Monterey, and San Luis Obispo
- Add fees for homebuilders, raising the cost of new housing in a state already facing an acute affordability crisis
- Expand property-related taxes, including vacant property penalties for landlords
- Institute new alcohol taxes, including a surcharge on late-night alcohol sales
Even the controversial “Billionaire Tax Act”—a one-time 5 percent levy on residents with net worth exceeding $1 billion—is part of this equation. While Governor Newsom has publicly opposed this ballot initiative, its very existence has already triggered an estimated $1 trillion in wealth fleeing California in recent months as high-net-worth individuals relocate to states with saner tax policies.
The Spending Problem Sacramento Won’t Acknowledge
Ronald Reagan, California’s most consequential governor before his presidency, famously said: “We don’t have a revenue problem, we have a spending problem.” His words ring even truer today than when he spoke them.
California’s Legislative Analyst’s Office—a nonpartisan state agency—issued a damning assessment in 2025 that Sacramento Democrats largely ignored. The LAO reported that California’s spending growth is “much too high” by historical standards, averaging 5.8 percent annually compared to 3.5 percent in previous periods. Meanwhile, revenue growth hovers just above 4 percent, meaning spending consistently outpaces income.
The LAO concluded bluntly: “We view it as unlikely that revenue growth will be fast enough to catch up to ongoing spending.”
This isn’t complex economics. It’s basic household budgeting. If your spending consistently exceeds your income, you eventually face a crisis—unless you’re Sacramento, where the solution is simply to take more money from taxpayers rather than exercise fiscal discipline.
The Newsom administration’s forecasting record adds another layer of concern. As CalMatters reported, the Department of Finance once overstated projected income by $165.1 billion over a four-year period—a staggering miscalculation that reflected wildly optimistic assumptions about sustained revenue growth following a temporary pandemic-era spike in personal income taxes.
That phantom $97.5 billion surplus Newsom trumpeted? It never existed in any official budget documents, yet it became the justification for massive new long-term spending commitments on social welfare programs the state now cannot afford to maintain without—you guessed it—raising taxes.
The Exodus Accelerates: Voting with U-Hauls
California’s tax-and-spend approach isn’t just fiscally unsustainable—it’s driving away the very people whose productivity and tax payments fund state government. The California exodus that began in earnest during the COVID-19 pandemic has accelerated into a full-blown migration crisis.
In 2025 alone, California recorded a net loss of approximately 216,000 residents. Between 2010 and 2024, nearly 10 million people moved from California to other states, while just over 7 million moved in—a net outflow of roughly 3 million residents. U-Haul’s 2025 migration report ranked California dead last for inbound moves, with more residents fleeing than any other state in the nation.
Who’s leaving? Not just wealthy individuals avoiding the billionaire tax. Working families. Middle-class professionals. Small business owners. Young people seeking affordable housing and better opportunities. These are the taxpayers who fund California’s bloated government, and they’re relocating to states like Texas, Florida, Arizona, and Tennessee—states with lower taxes, less regulation, and more respect for the principle of limited government.
Jon Coupal, president of the Howard Jarvis Taxpayers Association, captured the fundamental problem: “Any skepticism voters have in regards to state and local government is justified.”
When taxpayers look at homeless encampments lining streets despite billions spent on homelessness programs, when they see public schools failing despite the highest per-pupil funding in state history, when they experience rolling blackouts despite paying premium electricity rates—they rightfully question what they’re getting for their tax dollars.
The Broken Promises: Where Your Money Actually Goes
Los Angeles County provides a case study in government incompetence and broken promises. In 2025, county supervisors approved Measure A, which doubled the previous homelessness sales tax to a permanent half-cent levy. Voters were promised this money would address the visible crisis of tent encampments and street homelessness.
One year later, homelessness remains as acute as ever in Los Angeles, with encampments still dominating public parks and streets. Rather than acknowledge the failure and redirect resources, county supervisors recently voted to add another half-cent sales tax increase—this time ostensibly for healthcare—bringing the total sales tax rate to 10.25 percent.
Kathryn Barger, the lone dissenting vote on the LA County Board of Supervisors, called out the credibility crisis: “We are not, as a whole, credible when it comes to promises made, promises broken.”
This pattern repeats across California. The state’s gas tax, supposedly dedicated to fixing roads and infrastructure, climbs higher every year through automatic inflation adjustments—yet California’s roads remain among the nation’s worst. Education spending has skyrocketed without corresponding improvements in student outcomes. Billions allocated to address the homelessness crisis have failed to reduce homelessness.
The problem isn’t insufficient funding—it’s systematic mismanagement, lack of accountability, and a political culture that measures success by dollars spent rather than results achieved.
The Principles at Stake: Why This Matters Beyond California
For Americans who value constitutional governance, fiscal responsibility, and limited government, California’s tax crisis represents more than a regional concern. It’s a cautionary tale about what happens when one-party rule eliminates political accountability and progressive ideology supersedes practical governance.
Fiscal Accountability: Governments, like families and businesses, should live within their means. When spending consistently outpaces revenue, the responsible action is to reduce spending—not endlessly increase taxation. California’s refusal to exercise fiscal discipline demonstrates what happens when there’s no meaningful political opposition to check spending appetites.
Limited Government: The explosive 63 percent growth in California’s state budget since 2019 reflects a philosophy that government should expand into every corner of society. This isn’t building essential infrastructure or ensuring public safety—it’s funding a vast array of programs, mandates, and bureaucracies that crowd out private sector solutions and individual initiative.
Personal Responsibility vs. Government Dependency: Many of California’s new long-term spending commitments create permanent government dependencies rather than pathways to self-sufficiency. When government becomes the primary solution to every social challenge, it crowds out families, communities, churches, and civil society—the traditional sources of mutual aid and support that build strong, resilient communities.
Respect for Taxpayers: Every dollar the government takes in taxes is a dollar someone earned through their labor, ingenuity, and risk-taking. California’s tax proposals show remarkable disrespect for the productive citizens whose work makes government possible. There’s no recognition that taxpayers might have better uses for their own money than funding Sacramento’s priorities.
Economic Freedom: High taxes and oppressive regulatory environments limit economic freedom and opportunity. When California imposes some of the nation’s highest tax burdens, it restricts residents’ ability to save, invest, start businesses, and build financial security for their families. This isn’t just an economic issue—it’s a freedom issue.
The Road Forward: Demanding Better Governance
California’s $16 billion tax proposals aren’t inevitable. They represent political choices—choices that can be challenged, opposed, and defeated by engaged citizens who demand better governance.
The solution begins with rejecting the false premise that California needs more tax revenue. The state doesn’t have a funding shortage—it has a spending addiction and a management crisis. Before asking taxpayers for another dime, Sacramento should be required to demonstrate:
- Spending reduction: Where are the cuts to ineffective programs? Which duplicative agencies can be consolidated or eliminated? What percentage reduction in state workforce could be achieved through attrition and reorganization?
- Program effectiveness: What results have existing programs achieved? Which initiatives have failed to meet their stated objectives? Why should taxpayers continue funding programs that don’t work?
- Management accountability: Who gets fired when billions are wasted on homelessness programs that don’t reduce homelessness? What consequences face administrators who wildly overestimate tax revenues? How are government workers held accountable for poor performance?
- Competitive analysis: How do other states achieve better outcomes with lower spending? What can California learn from Florida’s success in attracting businesses and residents? Why do Texas taxpayers get better roads despite lower gas taxes?
These aren’t unreasonable demands. They’re the basic expectations that should apply to any organization managing public money.
Conclusion: The Stakes Couldn’t Be Higher
California’s $16 billion tax proposal isn’t just about money—it’s about the kind of state, and ultimately the kind of country, we want to live in. Do we believe in limited government that respects taxpayers and exercises fiscal discipline? Or do we accept perpetual government expansion funded by ever-increasing taxation?
The Tax Foundation’s research makes clear that California’s current path is unsustainable. Jared Walczak’s warning deserves emphasis: “The tax burden affects California’s economy, and some of these new proposals could drive out more capital investment, jobs and economic opportunity. When people move, they often don’t say they moved for taxes but for jobs. And what California has done with its tax policies is drive those jobs elsewhere.”
This exodus—of people, businesses, and opportunity—represents California’s future if current policies continue. The state’s political leadership shows no indication of recognizing, let alone addressing, the fundamental spending problem driving these endless tax increases.
But change is possible. It requires engaged citizens who refuse to accept Sacramento’s narrative that California simply needs more tax revenue. It demands taxpayers who insist on accountability, transparency, and fiscal responsibility from their elected officials. And it necessitates a willingness to make hard choices about which government programs actually serve the public interest and which merely serve political interests.
California once led the nation in opportunity, innovation, and prosperity. That California can be restored—but not through higher taxes, bigger government, and less economic freedom. It requires a return to the principles of limited government, fiscal accountability, and respect for the taxpayers who make everything else possible.
Call to Action: What You Can Do Now
Don’t let Sacramento’s $16 billion tax grab happen without a fight. Here’s how you can make your voice heard:
Contact Your Legislators: Find your state senator and assemblymember at findyourrep.legislature.ca.gov and demand they oppose these tax increases. Be specific—reference the California Tax Foundation report documenting 71 separate tax and fee proposals.
Share This Article: The mainstream media largely ignores California’s fiscal crisis. Share this article on social media, email it to friends and family, and help spread awareness about Sacramento’s spending addiction.
Get Involved Locally: Join your local taxpayer association or Republican club. Attend city council and county supervisor meetings. Run for local office or support fiscally conservative candidates who will oppose these tax increases.
Stay Informed: Follow organizations like the California Tax Foundation, Howard Jarvis Taxpayers Association, and California Taxpayers Association. Subscribe to newsletters from fiscally conservative state legislators who are fighting these proposals.
Vote Accordingly: In every election—from school board to governor—support candidates who pledge to control spending before raising taxes. Hold them accountable when they break those promises.
Consider Your Options: If California’s political leadership won’t change course, you have the right to vote with your feet. Explore opportunities in states that respect taxpayers and practice fiscal responsibility.
California’s future depends on citizens who refuse to accept business as usual in Sacramento. Your voice matters. Your engagement makes a difference. And your commitment to fiscal accountability and limited government is essential to stopping this $16 billion tax avalanche.
The time to act is now—before Sacramento’s tax collectors start reaching even deeper into your wallet.
