SACRAMENTO, Calif., March 12, 2012 /PRNewswire/ -- Today, Californians Against Higher Property Taxes released a study by Stephen Frates and Michael Shires at Pepperdine University's Davenport Institute, showing the devastating impact of increased property taxes on jobs and small businesses.
The study shows that by increasing property taxes on businesses by $6 billion, it would result in $71.8 billion in reduced economic output and 396,345 fewer jobs over the first five years of the tax increase. And those impacts would grow over time.
"With unemployment numbers leading the nation, and small businesses trying to recover, there could not be a worse time to force California businesses to pay higher property taxes. Higher taxes means businesses charging higher prices for their consumers, laying off their employees or even worse, closing their doors completely," said John Kabateck, Executive Director, National Federation of Independent Business – California.
The study further concludes that not only will it hurt small businesses, but that these kinds of tax increases would disproportionately harm small businesses owned by women and minorities because these businesses usually rent their space and property taxes are paid by the lessee as part of the lease.
"This sobering report shows the devastating impacts that these increases would have on small, minority and woman owned businesses," added Joel Fox, President of the Small Business Action Committee. "California should be engaging in tax policies that help small businesses thrive and create jobs, not kill them."
The study echoes recent public opinion polls showing overwhelming voter opposition to property tax increases. A September 2011 Field Poll showed that 63 percent of Californians supported Prop 13. Another 2011 survey from the Public Policy Institute of California showed that a strong majority of Californians supported Prop 13's taxpayer and property owner protections.
"The on-going attacks on Prop 13 will go nowhere fast with voters. Public poll after public poll shows opposition to proposals to increase property tax rates because it is bad for consumers and bad for the economy," concluded Jon Coupal, President of the Howard Jarvis Taxpayers' Association.
Local governments would face more instability as well as a result of a split roll property tax system, as they would be more directly affected by the boom and bust cycle of the real estate market. At a time when property values were falling in 2008-2009, property taxes from commercial and industrial property rose 5 percent, while their values declined 6.5 percent.
"Increasing property taxes is bad all the way around... It is bad for jobs, bad for small businesses and bad for local government budgeting," concluded Teresa Casazza, President of the California Taxpayers' Association.
Californians Against Higher Property Taxes (CAHPT), a coalition of small businesses, taxpayers and business organizations, is committed to continuing the education and increasing the awareness about the negative consequences of a split roll tax on Californians.
SOURCE Californians Against Higher Property Taxes