Constitutional Tax Rate. Initiative Constitutional

AMENDMENT. Authorizes establishment of constitutional tax rate so that total state and local tax revenues constitute 10.71% of personal income, as defined. Requires Legislature and Governor to adjust tax rate within 0.25% to maintain tax revenues at 10.71%. Imposes tax at constitutional tax rate on businesses and individuals; at twice constitutional rate if an independent contractor. Repeals Article XIII of Constitution which currently authorizes taxation of property, banks, corporations, alcoholic beverages and insurance companies. Imposes criminal penalties for prevention of implementation. Requires tax increases to be passed by voters. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local governments: Annual revenue losses to state and local governments from elimination of existing taxes of up to $81 billion on a full-year basis; unknown annual tax revenue gains to the state and local governments, roughly estimated at $81 billion on a full year basis, commencing 1995-96. Increased costs to the state General Fund of approximately $10.6 billion to replace K-14 school district property tax loses. Unknown state and local costs and savings, dependent upon the extent costs of administering new taxes are offset by savings from elimination of existing taxes