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San Bernardino Associate' <br />San Brmar&— Cormy Transporrarion Cammi5sion <br />San Bernardino CoaWV Transporrarion Aarhorin <br />San Bernardino Couary Congestion Management Agency <br />Service Authoring for Freewm- Amer <br />erreies <br />Minute Action <br />Opponents to AB 2640 argue that local govemmems and transportation entities hive <br />taken much of the brunt of state budget shortfalls over the last six years. They also <br />approved <br />San Benardrno At iared Gmn nrs <br />Board ojDvs(ars <br />Moved; Se md: <br />In Favor: Opp�d: Abea d: <br />' BkUD60af.SAN <br />rN 96srAo <br />JUN -05-1996 16:00 <br />209 <br />P.15 <br />22 <br />AGENDAITEM <br />Date: <br />June S. 1996 <br />Subject: <br />AB 2640 (Pringle) - Sales and Use Taxes: Gasoline "Tax on a Tax" <br />Recmm":endation-: <br />Oppose AB 2640 (Pringle) <br />Background. <br />Assembly Member Pringle's AB 2640 proposes to eliminate the combined total of <br />state and federal fuel taxes, (36.3 cents), from the fuel "sales price" upon which state <br />and local safes taxes are applied. The impact of this change would be a reduction of <br />appruxamately 25% of sales taxes generated on motor fuels assuming prices at today's <br />$L 50 a gallon levels. As fuel prices decline, the percentage of revenue lost would <br />increase due to state and federal gallonage fees remaining constant. AB 2640 <br />Ttiugle) will cost SANBIAG up to S1.5 million annually in lost revenue. Statewide, <br />self-help counties with voter -approved transportation sales taxes and counties <br />dependent on sales taxes for safety, health, <br />public and social service funding will also <br />lose revenues. These losses have brought about opposition to AB 2640 from CSAC, <br />the California Transit Association and the Self -Help Counties Association. <br />The arguments in favor of the bill are twofold. It's argued that motorists will gain <br />immediate relief from increasing gasoline prices; approximately a three cent a gallon <br />price reduction. Secondly a philosophical argument is being made against imposing <br />a tax on a rax, An example of this position is the federal tax deduction for a taxpayers <br />state income taxes. <br />Opponents to AB 2640 argue that local govemmems and transportation entities hive <br />taken much of the brunt of state budget shortfalls over the last six years. They also <br />approved <br />San Benardrno At iared Gmn nrs <br />Board ojDvs(ars <br />Moved; Se md: <br />In Favor: Opp�d: Abea d: <br />' BkUD60af.SAN <br />rN 96srAo <br />JUN -05-1996 16:00 <br />209 <br />P.15 <br />