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Schwarzenegger Proposes Sales Tax Increase

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LA County residents have been hearing all about a half-cent sales tax increase that we could be voting on in November at the ballot. It's a big could, depending on a state committee, but if it goes through and passed by voters, Metro would get an extra $30 to $40 billion over the next 30 years for transportation projects ("Subway to the Sea" being one of them). But today, to fix the state deficit, Gov. Arnold Schwarzenegger has proposed a one-cent statewide increase that would raise an expected $4 to $5 billion a year, says the Sacramento Bee. The state currently has a $15.2 billion budget deficit. The current statewide sales tax is 6.25% 7.25%, but LA County has local tax additions that bring it up to 8.25%, which would go up to 8.75% if the transit measure were to be passed in November. If both taxes get passed, LA County is looking at a 9.75% sales tax.