Proposition 13 Tax Curbs Face Attack In California Read More At IBD: http://news.investors.com/011013-640144-prop-13-tax-curbs-targeted-for-attack-by-calif-lawmakers.aspx#ixzz2HgCsIPO9

The tax revolt that swept California and the nation starting in the 1970s may have run out of steam, but its landmark law, Proposition 13, is still largely intact. That could change in the next two years as Democratic state lawmakers with a new two-thirds majority in both houses take aim at Proposition 13 tax restraints in their hunt for money. Taxpayer advocates are girding for battle. "This year, for us, will be devoted entirely to defending Proposition 13," said Jon Coupal, president of the Howard Jarvis Taxpayer Association. Backers of Proposition 13 warn that changes could pinch family finances and hurt businesses, large and small, in a state with joblessness still near 10% and costs higher than many locales. Passed in 1978 with nearly 65% of the state voting yes, Proposition 13 is a shield and political symbol. It has kept California property taxes moderate and predictable, capping them at 1% of a property's value when it last sold, plus a 2% annual inflation factor. Critics long blamed the law for state fiscal woes. But mainstream politicians knew it was popular and didn't want to touch it. Other Taxes Already Rising That was before November, when Californians OK'd a ballot initiative to raise income and sales taxes and put more Democrats in the Legislature. The new seats gave Democrats the power to enact tax hikes under Proposition 13's supermajority rule without Republican support, as well as to put amendments to the law before the voters. Liberals hailed the events as the end of an era. "The Tax Revolt is over," Robert Cruickshank wrote on the Calitics blog. The November vote was a victory for public-sector unions, which have the most to gain from weakening Proposition 13. It also put California business owners on alert for tax changes that fall hard on commercial property. "Even the people who advocate a change in Proposition 13 don't seem to want a change in residential (tax) rates," said Allan Zaremberg, CEO of the California Chamber of Commerce. Already, state Sen. Mark Leno wants to put a measure on the ballot to lower the two-thirds vote threshold for school district parcel taxes to 55%. State Sen. Lois Wolk introduced a bill that would ask voters to drop the vote threshold to 55% for library parcel taxes and bond measures. In the Assembly, Tom Ammiano plans to reintroduce a bill seeking to revise the definition of an ownership change that triggers a new business property assessment. Voters' OK isn't needed. Even if the bill stalls, as it has in the past, business owners fear that its goal — squeezing more tax money from commercial property — will surface in other proposals, some with better odds. Read More At IBD: