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California Proposition 3 Proposes Permanent Income Tax Extension on High Earners for Public Services

Voters evaluate landmark ballot measure to secure permanent funding streams for K-12 public education and community healthcare.

By Bay Area Chronicle
Published · 2 min read

Green wavy channel filled with multicolored rectangular blocks flows rightward toward a beige school building with clock and flag, next to a smaller clinic building marked with red cross; several blocks spill downward from a side branch at lower left on white background.

California voters are weighing Proposition 3 on the November ballot, a decisive fiscal initiative that would permanently extend the state's personal income tax surcharge on high earners to maintain guaranteed funding for public schools, community colleges, and healthcare services. Originally approved by voters as temporary Proposition 30 in 2012 and extended through 2030 under Proposition 55 in 2016, the measure seeks to eliminate recurring sunset deadlines for the state's most lucrative progressive revenue mechanism.

Under statutory provisions certified by the California Secretary of State, Proposition 3 maintains existing marginal surcharges ranging from 1 percent to 3 percent on single tax filers earning more than $350,000 annually and joint filers exceeding $700,000. Nonpartisan fiscal analyses prepared by the Legislative Analyst's Office project that a permanent extension will generate between $8 billion and $12 billion in annual state revenues, with 89 percent earmarked for K-12 school districts and community college programs, while 11 percent bolsters Medi-Cal and community clinic operations.

Campaign finance records filed with state election regulators show that supporting committees, anchored by the California Teachers Association and healthcare labor unions, have assembled more than $40 million to finance statewide voter outreach. Proponents argue that without a permanent extension, school districts in San Francisco, Oakland, and the East Bay would face destabilizing budget deficits and teacher layoffs once existing provisions expire.

Taxpayer advocacy organizations and business groups voiced opposition, contending that California's highest-in-the-nation top personal income tax rate of 13.3 percent accelerates the relocation of corporate headquarters and entrepreneurial talent to low-tax states. Nonpartisan voter information guides, comprehensive fiscal impact charts, and arguments submitted by campaign committees are available online through the Secretary of State portal at sos.ca.gov. California registered voters will begin receiving official vote-by-mail ballots this week.

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