Middle Class Fiscal Relief Act.
ACA 22 is intended to impact state fiscal policy by reallocating corporate tax revenues towards public benefits. Specifically, it excludes revenues from the newly created fund from the constitutional limitations on state appropriations, permitting greater flexibility in funding educational initiatives and social support programs. This change is designed to address economic disparities by ensuring that profits from larger corporations contribute directly to public welfare and education enhancements.
Assembly Constitutional Amendment No. 22, known as the Middle Class Fiscal Relief Act, proposes to amend the California Constitution by adding provisions that impose a 10% surcharge on corporations with net incomes exceeding $1 million for taxable years starting January 1, 2018. The revenue generated from this surcharge will be deposited into a newly established Middle Class Fiscal Relief Fund. The measure aims to allocate funds towards fiscal benefits for lower and middle-income Californians, alongside supporting public education institutions.
There are several points of contention surrounding ACA 22. Supporters argue that the bill will provide much-needed fiscal relief and support for middle-class families in California through expanded access to tax credits, child care, and health care. Conversely, opponents may raise concerns about the potential economic impact on corporations facing increased taxation, fearing potential job losses or reduced investments in the state. The capacity for the legislature to modify the surcharge may also lead to debate over fiscal management and priorities.