State Tax Cuts and Rebate

May I suggest a balanced approach in providing both a tax cut and a tax rebate?

First, promote small business by reducing the top income tax rate by 5%. Second, give the middle class a tax cut by raising the tax brackets by 10%. Third, help low-income workers by raising the standard deduction by 20%. These income tax cuts would save California taxpayers $1.8 billion each year.

Next, provide an instant rebate to every California automobile owner by canceling the sales tax on gasoline and reducing the property tax on automobiles (car tax) to a sensible 1% tax rate. These changes would save California drivers another $1.8 billion annually.

No tricks, no magic, just common-sense tax reduction.

ROLAND A. BOUCHER

Irvine

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* A letter writer (May 30) repeats the lie that the poor have not contributed to the state surplus. Facts are that state income tax is the largest source of income for the state treasury. However, state sales tax is the second largest source of income, and the poor contribute every time they spend a dollar.

If the poor and the well-to-do contribute to the sales tax, why the emphasis on an income tax refund? An income tax refund would help only the families who earn enough to pay income tax. A sales tax refund would help all Californians.

LOU BARAK

Sherman Oaks

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* As I teacher I appreciate Gov. Gray Davis’ proposal to exempt my income from state taxation. Just the same, I agree the proposal is unrealistic. Teacher salaries should be negotiated at the local level.

A much better idea would be for California to join other states in exempting government entities, including school districts, from sales taxes. There would be an immediate savings of 7.5% or more on all purchases. Local governments would decide how to use this financial shot in the arm to best serve the needs of their residents.

JOHN N. MORRIS

Monrovia