No new taxes on pet care, wine

Winemakers and animal-lovers breathed a sigh of relief on Thursday with the passage of the California state budget. The budget isn’t pretty, with hikes in sales tax, vehicle fees and more, but it doesn’t include two proposed taxes that locals had been watching closely.
One was a proposed tax on veterinary services that would have added some 10 percent to the cost of care. The California Veterinary Medical Association launched a huge campaign to fight the tax, arguing that it would cause people to postpone taking their pets to the vet and may result in more animals being euthanized.
The second was the so-called “nickel-a-drink” tax on alcohol. According to the Wine Institute, the measure would have raised the state’s wine tax by 640 percent, with fees increasing from $0.20 per gallon of wine to $1.48 per gallon. The increase would create sticker shock particularly on California’s lower-priced wines, which make up the bulk of the market.
District 6 Assemblyman Jared Huffman predicted last week that the excise tax on wine wouldn’t go through. He had been lobbying against the tax, pointing out that wine is a huge industry for California, one that generates billions of dollars in revenue and more than 300,000 jobs.
The bullet has been dodged … for now. However, the proposed budget includes a spending cap and new taxes that are subject to voter approval in a special election in May. If there is a budget shortfall later in the year, some of the taxes that have been discussed over the past few months could be back under consideration.