(SACRAMENTO)—In a recent guest piece published by the San Francisco Chronicle, Mark Hinkle, president of the Silicon Valley Taxpayers Association, explains the flaws in Proposition 56, the $1.4 billion special interest tax grab on the November ballot, and encourages voters to follow the money to see that the majority of the money raised by the tax would go to the wealthy special interests backing the initiative.
San Francisco Chronicle: Opposing view on Prop. 56: Vote no on $2-a-pack tobacco tax hike
Proposition 56 increases tobacco taxes by $2 a pack and claims it is all about reducing smoking. But if you follow the money, it becomes clear that it’s really about giving billions of dollars to health insurance companies at the expense of our schools, fighting violent crime and fixing our roads. Under Prop. 56, health insurance companies and other wealthy special interests who are backing the initiative will receive approximately $1 billion each year in new tax money from a provision that provides “improved payments” to health care providers. They say the money will go to treat patients, but, as the saying goes, the devil is in the details.
Prop. 56 is a tax grab primarily for health insurance companies who will get the lion’s share of the estimated $1.4 billion raised by the higher tax without having to treat more Medi-Cal patients. That way, insurance companies can increase their bottom line.
But Prop. 56’s flaws go beyond where the money goes — it’s about where it won’t go. The state Constitution requires that schools and community colleges get about 43 percent of any new tax increase. This was the clear direction from voters when they passed Proposition 98 in 1988. But Prop. 56 intentionally exempts funds it would collect from this requirement of Prop. 98, thus shortchanging schools by at least $600 million each year. In fact, circumventing Prop. 98 is the only reason Prop. 56 is a constitutional amendment.
Don’t be fooled. Prop. 56 is sponsored by savvy special interests. It lacks vital protections that would ensure our tax dollars are going to treat more Medi-Cal patients and to help keep more kids from starting to smoke. We have a lot of important issues facing our state; padding insurance CEO salaries with taxpayer dollars isn’t one of them.
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