Arnold Schwarzenegger wants to tax the crap out of you if you work, drive, or spend in California. Perhaps we can organize to defeat Prop 1A and recall Schwarzenegger’s band of tax-hiking legislators. But there are things you can do immediately to cut your own taxes and foil Schwarzenegger’s evil plot.
The huge tax increases go into effect April 1, so that would be a good day to start implementing as many of these as possible:
Sales tax: cut consumption of taxable goods as much as possible
– No more restaurants. Buy untaxed groceries instead. You’ll save far more money than just the sales tax amount, and you’ll eat healthier and learn to cook as well!
– Buy used stuff from private parties (e.g. on Craigslist) rather than new stuff. You can find just about everything you need there.
– No more soft drinks. Unlike most food, they are taxed, plus there are outrageous recycling deposits on bottles and cans that are usually forfeited to the state with curbside recycling.
– If you must make a big purchase, make it out of state. What a good excuse for a trip to Vegas!
Car tax: keep your old car, and if you must buy, buy used
– Schwarzenegger has doubled the car tax, which is an annual tax based on the value of your car. Obvious solution: drive a cheaper, older car. This also cuts your sales tax on the purchase transaction.
Income tax: cut your taxable income where it makes sense
– Max your 401(k). If you do a Roth 401(k), consider switching back to a traditional 401(k) for the immediate deduction.
– If you are a consultant, run your own business, or otherwise have flexible income, consider cutting back your hours and enjoying life a little (with your old car and reduced consumption, you don’t need as much money any more!).
– If you are a two-income family paying for child care, consider dropping one income and staying home with the kids!
If you look at this list, most of these are things that you probably want to do anyway. Maybe we should thank the evil Schwarzenegger for inspiring us to do what we should have been doing all along.
Fight socialism and save your family finances at the same time!