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CA

Bill

S 4930

Sets flat gross income tax rate at 5.9 percent tax for all taxable income over $37,500 or $75,000, depending on filing status; exempts taxpayers with less income from gross income tax.

2024-2025 Regular Session Introduced by Carmen Amato

Imposes a flat 5.9% gross income tax on income above filing-status thresholds ($37,500 or $75,000), with low-income filers exempt.

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WeVote Research Nonpartisan
Bill Summary · S 4930

Summary of Bill S.4930

Overview

Bill S.4930 proposes a flat gross income tax rate of 5.9% on all taxable income above specific filing-status-based thresholds. Taxpayers with income below the thresholds would be exempt from the gross income tax. The measure is identified as an income tax bill and has a companion in the Assembly (A 6021).

Purpose and intent

  • Introduce a uniform, flat gross income tax rate for higher earners while exempting lower-income taxpayers from gross income tax.
  • Create a simplified approach to income taxation by applying a single rate above threshold amounts, rather than a tiered system.

Key provisions

  • Tax rate: A flat rate of 5.9% applies to all taxable income above defined thresholds.
  • Thresholds: The threshold amount depends on filing status, with amounts specified as $37,500 or $75,000.
  • Exemption for low income: Taxpayers with income at or below the threshold are exempt from the gross income tax.
  • Structure: The bill targets “gross income tax” and does not specify other related credits or deductions within this summary.

Filing status and thresholds

  • Thresholds are determined by filing status, resulting in two possible cutoffs: $37,500 or $75,000.
  • Tax is assessed only on taxable income above these thresholds.

Who would be affected

  • Individuals with taxable income above the applicable threshold would pay the 5.9% rate.
  • Households or filers with income at or below the threshold would not owe gross income tax under this bill.
  • The policy would primarily impact higher-income earners, while providing relief to lower-income taxpayers through exemption.

Procedural and timeline aspects

  • Introduced: February 14, 2025.
  • Legislative actions (selected timeline):
    • February 14, 2025: Referred to Local Government.
    • February 25–26, 2025: Reports CAL (1st and 2nd Reports CAL).
    • March 3, 2025: Advanced to Third Reading.
    • June 13, 2025: Committed to Rules (duplicate entry listed).
  • Status updates indicate progression through standard committee and floor processes, with a companion bill in the Assembly (A 6021).

Sponsors and supporters

  • Primary sponsor: Monica Martinez
  • Cosponsors: Mario Mattera, Robert Jackson, Christopher Ryan, Robert Rolison, Lea Webb, Anthony H. Palumbo, Steve Rhoads, Peter Oberacker

Related legislation

  • Companion bill: A 6021 (Assembly)

Potential impact and considerations (note)

  • Revenue impact is not provided here; adopting a flat rate on income above thresholds could shift how revenue is collected compared with existing progressive structures.
  • The exemption for low-income filers excludes a portion of taxpayers from gross income tax entirely, which has implications for redistribution and revenue adequacy.
  • Details on interaction with deductions, credits, and other taxes are not specified in the provided information.

For a complete assessment, reading the full bill text and fiscal notes would clarify effective dates, transition rules, and interaction with existing tax code provisions.

Compiled from official sources — confirm details with the bill’s official record.

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