Jerry Brown and a Return to Tax Commissions

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Davis’s commission, known formally as the California Commission on Tax Policy in the New Economy, was headed by current Los Angeles City Councilman Bill Rosendahl. Among other recommendations, the commission suggested that sales tax rates be lowered but extended to services, that the vote requirement to raise special taxes on the local level be reduced, and that a long look be taken at periodically reassessing non-residential property to market value.

The final report from Rosendahl’s commission was issued in December 2003, one month after Schwarzenegger had replaced Davis. It was ignored.

Schwarzenegger also made an effort to reform the tax system, appointing Gerry Parksy to head the Commission on the 21st Century Economy.  That Commission proposed the creation of a new Business Net Receipts Tax, which found political opponents from both business and labor. The Business Net Receipts Tax, in a roundabout way, dealt with the issue of taxes on services. The Parsky Commission plan made little headway with the legislature or interest groups.

Jerry Brown is no stranger to proposing major tax code changes. Brown ran one of his presidential campaigns on the idea of a "flat tax." The New York Times called Brown’s proposal the "...one truly creative and important idea to emerge from this Presidential campaign."

As spending cuts and tax increase solutions of the recent past do not seem to solve California’s deficit problems, a restructuring of the tax code to promote growth seems logical, and Jerry Brown likely will be the third governor in a row to attempt tax restructuring.