America's Property Tax Advisor

California 2022 Tax Initiatives

BY SCOTT DONALD, IRVINE, DECEMBER 2021

Property tax initiatives are routinely filed in California. Some are approved and others are not. For example, voters rejected an attempt last year to create a split-roll property tax system that would have lifted Proposition 13 limits for certain types of commercial properties.

 

A couple of major tax initiatives have already been filed with the California Attorney General’s office for 2022. They require 997,139 valid signatures to get on the November 2022 ballot.

 

Tax Cut and Housing Affordability Action

 

Initiative 21-0032 would put a surcharge on high-value properties to pay for an increase in the homestead exemption from $7,000 to $200,000 and to fund credits for renters.

 

As of now, the floating range of the surcharge, starting as low as .5% to 1.2%, is based upon a range of market value. This is interpreted to be assessed value since California doesn’t track market value other than subject property transactions.

 

While the proposal states that the surcharge is not allowed to be passed on to tenants, there doesn’t appear to be any tracking mechanism to enforce it. The surcharge is not deductible as a write off for state personal income tax.

 

Taxpayer Protection and Government Accountability Act

 

Initiative 21-0026A requires voter approval for any statewide tax increase. It also aims to close loopholes that allow some local tax increases to pass with a simple majority when voters were told in the ballot materials that a two-thirds vote was required.