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Transportation United States Politics

California Voters Weigh New Tax On Rich To Boost EV Adoption (apnews.com) 133

An anonymous reader quotes a report from the Associated Press: Should California's richest residents pay higher taxes to help put more electric vehicles on the road? That's a question the state's voters are weighing in the election that concludes Tuesday. Proposition 30 would place a new 1.75% tax on incomes above $2 million, which is estimated to be fewer than 43,000 taxpayers. It would raise billions annually, with most going to help subsidize the purchase of electric vehicles and construction of charging stations. Twenty percent of the money would go toward boosting resources to fight wildfires. The ballot fight comes as California races to reduce emissions from transportation -- by far the largest source -- and meet its ambitious climate goals. Wildfires, meanwhile, are spewing more carbon into the air as they become larger and more destructive, threatening to set back the state's progress.

Though Democratic Gov. Gavin Newsom pushed for a policy that bans the sale of most new gas-powered cars in the state in 2035, he does not support Proposition 30. That's pit him against the state Democratic Party and a number of environmental and public health organizations. Newsom has called it a taxpayer-funded giveaway to rideshare companies, which under California regulations must ensure nearly all trips booked through their services are zero-emission by 2030. Lyft supplied most of the "yes" campaign's funding; competitor Uber has not taken a position.

Backers of the measure, including most major environmental groups, say the state needs a dedicated, robust source of funding to set up infrastructure that can handle more plug-in cars and to help Californians of all income levels to buy them. The money won't go exclusively to passenger cars; the state could also tap it to put cleaner delivery trucks, buses and even e-bikes on the roads. A portion of the money must go to help people in low-income or disadvantaged communities buy or access electric cars. [...] Rideshare companies like Lyft do not own the vehicles their drivers use, but they are still on the hook to ensure that trips booked through their app will be zero-emission. Proposition 30 does not include any provisions that exclusively benefit Lyft. But Newsom and other opponents say the measure would allow Lyft to rely on taxpayer dollars, not company money, to help its drivers transition to electric cars. Supporters of the measure, though, say an effort to raise taxes on the rich to boost electric vehicle adoption was in the works before Lyft got involved.

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California Voters Weigh New Tax On Rich To Boost EV Adoption

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  • by alvinrod ( 889928 ) on Tuesday November 08, 2022 @05:08PM (#63036907)
    They may as well considering all of the subsidies that were given to the wealthy to purchase electric vehicles in the first place. I'm willing to bet that the bottom half of tax payers purchased nowhere near half of the electric vehicles that received tax credits or other forms of government subsidies in the past.

    It's a stupid policy and a bad idea in general, but it at least considers balancing the books.
    • by crackerjack155 ( 1328815 ) on Tuesday November 08, 2022 @05:25PM (#63036949)

      The subsidies on BEVs are nothing compared to the subsidies for gasoline and diesel.

      • We shouldn't be subsidizing that either. A greater error doesn't cancel out or remove the folly of a smaller one.
        • by kellin ( 28417 ) on Tuesday November 08, 2022 @06:34PM (#63037091)

          Removing subsidies for gasoline will force us to pay the same rates as Europe. No politician would ever sign off on that, Biden is already getting enough grief over the fact that the oil companies have been gouging the public for the last year and raking in record profits.

          • Removing subsidies for gasoline will force us to pay the same rates as Europe.

            Interesting words. I wonder how you came to that conclusion.

            If there are no taxes or subsidies at all on fuel, the price is about a 1/4 of what Americans pay at the pump. I have paid those prices in the real world. Less than a dollar per American gallon. Subsidies would reduce that price even more.

            TL;DR, Europe taxes gasoline a LOT because it is a lucrative revenue source. It has nothing to do with mitigating climate change, it is steady revenue because demand is ineleastic (I am NOT changing that to 'not e

        • We shouldn't be subsidizing that either.

          Agreed, but it isn't so simple. Government support for ICEs is mostly structural rather than specific cash subsidies that can be easily repealed.

          Government support for ICEs is also very popular since the alternative is more expensive gasoline.

          A greater error doesn't cancel out or remove the folly of a smaller one.

          Actually, it kinda does. If X and Y are direct alternatives, then subsidizing both equally helps keep the competition level.

          The best way to help EVs is higher gas taxes, but that is a political non-starter.

    • Given to the set of Wealthy people, set W, where W can be defined however you damn well please. I have a plug-in vehicle, and I'm not what most would consider wealthy. Yes, I make more money than a farmer in Alabama perhaps but less than most of my farmer relatives in California (who drive absurdly expensive F150s). My income is mostly from salary, not from inheritance or investments. There are EVs cheaper than my plug-in hybrid, do not assume that all EVs are like first generation Teslas deliberately m

      • There are EVs cheaper than my plug-in hybrid ... There are EVs cheaper than your Honda Civic out there

        If you are referring to EVs not coming from traditional US, EU, Japanese and South Korean automakers, then those EVs are often extremely dangerous to ride in according to crash testing. They are minimalist and trade safety for cost.

    • Any policy that supports fake eco cars is a bad policy.
    • I'm willing to bet that the bottom half of tax payers purchased nowhere near half of the electric vehicles that received tax credits or other forms of government subsidies in the past.

      The bottom half of taxpayers don't purchase new vehicles period. Trickle-down economics is a failed concept in general, but it does still apply well in some circumstances. Giving incentives to people who can afford something to help push policy is far more effective than giving incentives to people who can't and thus won't. The goal of such policies is not to push poor people into buying expensive cars, it's to ensure more cars get purchased (by whomever) in order to boost economies of scale.

      And that policy

    • If you own 80% of the economy, you should pay 80% of the taxes due to run that economy. Sloughing responsibilities ends in lots of dead people.

  • with lift and uber forced to make drivers employees then they may as well supply the cars to the drivers.
    and they can't rent them out to them (unless after rent fees they still at least make min wage (tips not counted)) and can't force them to pay for any damage / fuel / miles / cleaning / upkeep / etc)

  • by MachineShedFred ( 621896 ) on Tuesday November 08, 2022 @05:12PM (#63036913) Journal

    Then the wealthy of California, who probably already have EVs if they want them, can help pay for it.

    Not really sure what the beef here is - this is actually helping one of the biggest barriers to adoption: higher up-front cost of EVs make it harder for lower income buyers to be able to buy.

    I guess it's fine mandating what poor people must do, as long as you don't need to help them do it?

    • I take it you don't believe that the wealthy of California won't just move across the State Line to Nevada, Oregon, and Arizona?

      • I take it you don't believe that the wealthy of California won't just move across the State Line to Nevada, Oregon, and Arizona?

        And keep in mind only their residency needs to actually move, they can still have their "vacation homes" in California regardless of where their residency for taxation is.

      • If they are dodging taxes, they aren't going to Oregon.

      • That's perpetually the right's argument about pretty much any new policy in CA, but over and over again the numbers show that it isn't true. The people who are leaving CA are people who can't afford to live here anymore, and their exit is more than made up for by new people moving in.

        • I left California for another "high tax" state with better weather. I pay ~35% lower income tax and half the sales tax now; my property tax bill would be 3x as much in California as well for the same cost home. (I'm not on the Right either.)

          You do get to a certain point where it feels like taxation without representation in California, and that does push a small percentage of high earners out.

      • They'll move out as you mention. Additionally upper income people pay most of the taxes in California so they'll lose that revenue. The top 1% pays nearly 50% of California's income taxes.

    • Why do lower income people need to buy? We're supply constrained on batteries. So long as every BEV manufactured sells, the net effect of BEV vs. ICE sales is achieved. Lower income people are also much more likely to lack sufficient charging access. BEVs make the most sense for those who own homes and can charge over night. People in apartments, condos, houses with street parking, etc are far off from having consistent charging options. That will change in time, but not near term.

      Subsidizing lower inc

      • This is Machiavellian, but correct. If the aim is to improve air quality and reduces money going to petro-states, so long as we sell all the cars we make, it doesn't matter who gets them.

        The problem is that that's only half the equation, and, once the chip shortages are over it's likely car companies will be able to make more EVs than can sell at the price points they're selling them at.

        The other half of the equation is that EVs are vastly cheaper to run. So giving the rich, for whom gas costs are immater

  • 1.75% tax on people making over $2m. I wonder how many millionaires will relocate somewhere else instead of being subjected to higher taxes?

    • Re: (Score:2, Funny)

      by dmay34 ( 6770232 )

      Bye bye. Don't let the invisible hand of the market smack you on the way out!

      • Bye bye. Don't let the invisible hand of the market smack you on the way out!

        Funding an artificial market for lower/middle class EV through a tax on wealth is the invisible hand of the market?

        • Yes. Because the market has many, many invisible hands. Often they are connected to lobbyists, campaign contributions, threats of layoffs, etc. That gets the invisible hand of tariffs, the invisible hand of crop subsidies, the invisible hand of utilities making profits from building power stations, with no incentive to lower per watt cost, etc.

    • All of them. I mean, even if they don't leave, they'll have the resources to fake residence somewhere else, while still living in California. That's the problem with trying to tax the rich locally. There's always another pond for them to hop to, and they always have the resources to do it.

    • by UMichEE ( 9815976 ) on Tuesday November 08, 2022 @05:38PM (#63036981)

      It's kind of an interesting question, but keep in mind that the marginal tax rate on someone making $2M in California right now is 49.3%. It's hard to understand how pushing that to 51% would cause a mass exodus, unless it's just the straw that breaks the camel's back. The bigger deal for someone in that position was the SALT limit that was part of the Trump tax cuts. Previously that high earner could deduct the state income tax for their federal taxes, but not anymore, which essentially raised their marginal tax rate by 3-4 percentage points. Have we seen an exodus of wealthy people from California since 2018?

      • by Caro Cogitatus ( 7226002 ) on Tuesday November 08, 2022 @07:15PM (#63037195)

        Have we seen an exodus of wealthy people from California since 2018?

        According to this site [deptofnumbers.com], California's real median income was 4.32% higher in 2021 than in 2018, while the U.S. was up by 4.54% in that same time frame.

        Florida was up by 5.38% and Texas up by 2.36% for red states with similar population and/or economies, and the reddest state in the union, Wyoming, was down 1.87%.

        So if there was a mass exodus, its effect was pretty minimal.

    • So they'll move somewhere worse to dodge 1.75% when they're already making $2m/year AGI?

      My guess is "zero".

      • For one thing, the wealthy can afford to buy assets that appreciate, and so make much money on capital gains, taxed at a reduced rate. Plus I do not think gains on family home are taxed in CA.

        Same thing happens here in Australia.

        • Plus I do not think gains on family home are taxed in CA.

          Not true, it's treated like regular income, although the first $250k of gains ($500k for married couples) is not taxed.

      • They're rich. They don't have to actually move. They just establish residence somewhere else.

        If filing the paperwork and pretending they actually live in , oh, Wyoming instead of California costs X, and the tax increase is X + Some amount, they'll fake it.

    • by Local ID10T ( 790134 ) <ID10T.L.USER@gmail.com> on Tuesday November 08, 2022 @06:49PM (#63037139) Homepage

      Silicon Valley techies and Hollywood movie stars are not likely to leave California to avoid paying taxes on the millions they are making from living in California.

      Sure, some will leave... but others will take their place and their well paying jobs -along with paying the taxes on that income.

      Note that this tax has no effect on the actual rich -those with long-term investments that fuel their lifestyles across generations.

      Despite all the naysayers, California's economy continues to grow. It just supplanted Germany as the world's 4th largest economy.

      • ... the millions they are making from living in California.

        Correction, making from working in California. Having a legal residency in another state and "vacationing" in CA for over six month might let CA dispute the residency but "working" in CA is something else, a possible loophole. Of course it's all moot if they are in CA for less than six months.

        I'm thinking of athletes who only reside in CA for the "season", or actors while 'filming" TV or a movie.

        For others, let's call them remote employees who sometimes visit the CA office. Is that a potential loopho

    • 1.75% tax on people making over $2m. I wonder how many millionaires will relocate somewhere else instead of being subjected to higher taxes?

      Relocate may be a strong word. Only their legal residency needs to actually move, they can still have their "vacation homes" in California regardless of where their legal residency for taxation is.

    • 1.75% tax on people making over $2m. I wonder how many millionaires will relocate somewhere else instead of being subjected to higher taxes?

      Because the rich love living in dirty shitholes that spend nothing on infrastructure and development to better the area in which you live?

      Look I'm completely mobile, I *could* live in a low tax country and keep every cent I make. Or... I could continue paying high taxes (far higher than California) and enjoy the excellent roads, infrastructure, healthcare, schooling, parent support, mobility etc. etc. that taxes pay for.

      It may come as a surprise to you but people typically live where they *like* to live, no

  • Externalized costs (Score:4, Insightful)

    by rsilvergun ( 571051 ) on Tuesday November 08, 2022 @05:19PM (#63036939)
    We spend billions of dollars on medical care treating conditions caused by smog that wouldn't exist if we didn't use tiny explosions to get to work everyday. It seems perfectly reasonable to shift those costs onto the people benefiting the most from them. The rich
    • The rich use gas turbines, not tiny explosions. I used to watch Armand Hammer's helicopter land on Occidental Petroleum's helipad several times per week. He also had a Boeing 727.
  • by dmay34 ( 6770232 ) on Tuesday November 08, 2022 @05:30PM (#63036965)

    They should use it to fund ocean water desalination plants as well as new pipelines and pump systems and water reclamation systems.

  • by bjdevil66 ( 583941 ) on Tuesday November 08, 2022 @05:40PM (#63036983)

    This proposition is just another tax on the wealthy to randomly fund some need.

    If CA really wanted to increase EV adoption (vs. just tax and spend), wouldn't they be more efficient by putting a sales tax on the thing they're trying to replace (ICE cars)?

    • This proposition is just another tax on the wealthy to randomly fund some need.

      If CA really wanted to increase EV adoption (vs. just tax and spend), wouldn't they be more efficient by putting a sales tax on the thing they're trying to replace (ICE cars)?

      Taxing ICEs won't make EVs more affordable. It will just mean less people can afford to drive. Some will see that as a win for the climate. Others will see it is simply increasing the number of people living in poverty.

    • This tax like everything before that will go into the general fund and will be used to fund ballooning government pensions.
  • Before you start pushing anyone to fully jump on the EV bandwagon, consider:

    1) Beef up the power grid to ensure it can handle the extra pull from everyone and their brother charging a vehicle
    ( Tip: If your State is still doing rolling blackouts during periods where demand > supply, your grid is not ready for EV )

    2) Curious why no one talks about the cost of replacing the battery arrays. Five to Seven years in, it's going to happen and
    it is far from cheap. ( I think Tesla's run ~$15-20k ? )

    3) Those t

    • by divide overflow ( 599608 ) on Tuesday November 08, 2022 @07:07PM (#63037179)

      Beef up the power grid to ensure it can handle the extra pull from everyone and their brother charging a vehicle

      Grid enhancement is happening here in California. Large infrastructure improvements take time, but several are in progress and more are scheduled. And several improvements will also address changes to reduce the likelihood of starting wildfires due to high winds causing power line failures.

      Curious why no one talks about the cost of replacing the battery arrays.

      Those battery packs have been lasting much longer than their original estimated lifespans. The prices of the batteries may drop as production ramps up and more manufacturers and battery chemistries are added to the mix.

      You're not going to pull a trailer with a Leaf or a Tesla

      Non-sedan vehicle options exist and many more are on their way. Ford F-150 Lightning, Chevy Silverado EV, Rivian R1T, Tesla Cybertruck, and a slew of SUVs including a ton of Tesla Model Y and Model X SUVs already on the road.

      • by nasch ( 598556 )

        There are EVs that tow, but range drops drastically when towing. That is a problem that will need to be addressed before gas and diesel can be phased out entirely, because towing a trailer long distances is apparently quite a pain currently. Besides the low range, charge points are generally not designed with trailers in mind, so best case scenario for the most part is needing to back up with the trailer after charging, and worst case is having to find somewhere to park the trailer, unhook, charge, and co

    • Teslas CAN tow however?

      https://www.youtube.com/watch?... [youtube.com]

      Video of a model X towing an "uncooperative" 2500, in that the parking brake is still set on the truck. Then there's going to be the cyber truck eventually. 100% torque at 0 rpm is great for moving things.

      As for batteries (no need to specify "battery array", a battery is already an array of cells), not really, they're already lasting over a decade, not just 5-7 years, and prices are dropping like a rock for them. Rebuilt batteries are available for

  • As of 9:30 PST, the Sec State site at 35% reporting has No winning 56.9%.

  • Given how a minority of the population pays in more than they get out, this continuing push to 'tax the rich' is risky. That and high earners are more easily able to relocate where they won't be increasingly raised to fund government largesse.

  • This is an interesting document arguing that the Western world's failure to get the users of fossil fuels to pay the full cost of the pollution that they cause constitutes a subsidy to them worth over a $trillion a year

    https://www.imf.org/en/Topics/... [imf.org]

    • Agreed!

      Once the EV manufacturing hurdles of the last year have passed, we could spend that entire fossil fuel subsidy every year on shoving EVs to everyone who'll take one and helping everyone and their brother set up charging/grid support infrastructure.

      But it seems like we could start banking that subsidy now, and ramp up the amount, so that we get more infrastructure-supporting infrastructure going -- lithium extraction, for example.

      A promise of $X this year, $X*2, then next, $X*3, then next, etc. for so

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