Before Californians ever see a dollar of their paycheck, part of their income is already gone.
State income tax. Federal income tax. Payroll deductions. Disability insurance. By the time the money reaches a family’s bank account, it’s only a portion of what they actually earned.
And that’s just the first round.
The second begins the moment that paycheck is spent. Sales tax at the register. Gas tax at the pump. Property tax in the mailbox. Vehicle registration in the fall. Utility bills that include public purpose program charges, renewable energy mandates, and other state-required surcharges that quietly raise the cost of keeping the lights on. Fees attached to everything from car tires to home improvements.
Layered on top of this is a growing web of charges created not by elected lawmakers, but by regulatory agencies. The California Air Resources Board (CARB) imposes fees tied to emissions programs that ultimately show up in higher fuel prices and increased costs for goods. The California Public Utilities Commission (CPUC) approves a wide range of utility surcharges to fund energy efficiency programs, wildfire mitigation, and grid upgrades, costs that are passed directly on to ratepayers. In Southern California, the South Coast Air Quality Management District (SCAQMD) adds its own layer of fees and rules that affect everything from small businesses to household appliances.
These agencies are not elected bodies. Their leaders are appointed, and their decisions are made through regulatory processes that most Californians never see. Yet their policies carry real financial consequences. The costs are often buried in monthly bills or built into the price of everyday goods, making them easy to miss but hard to avoid. The result is a system where a significant share of what families pay is shaped outside the direct accountability of voters.
For a young couple trying to save for a down payment on their first home, this matters. For parents setting aside money for college, it matters. For families already stretched by childcare costs, rising insurance premiums, and grocery bills, it matters even more.
California’s tax system has many moving parts, and the total adds up quickly when you look at the full picture. At the state level, Californians pay a progressive income tax that starts at 1 percent for the lowest earners and rises to 13.3 percent for the highest earners on taxable income over $1 million, in addition to the federal income tax, which can range from 10 percent to 37 percent. That top marginal rate includes the voter-approved 1 percent mental health services surcharge, and it is among the highest in the nation.
Our sales tax is also one of the highest. The statewide base rate is 7.25 percent, but most counties and cities add local taxes that bring the average combined state and local rate to about 8.98 percent. In some cities, local voters have approved additional taxes so the combined sales tax rate can exceed 10 percent. That means everyday purchases — clothing, school supplies, and household goods — cost significantly more than the sticker price.
Then there are property taxes. California caps general property taxes at 1 percent of assessed value under Proposition 13, but that does not include voter-approved local bonds, parcel assessments, Mello-Roos charges, and special district fees that may increase what a property owner pays each year. On average effective property tax rates are about 0.7 percent of property value, though local charges can push the actual amount much higher. For homeowners and renters alike, these layered assessments raise the overall cost of housing.
Look at these figures together and the burden becomes clearer. In 2022, state and local governments in California collected about $10,319 per person in taxes, one of the highest per-capita totals in the country.
And that figure does not capture the full story.
Part of the confusion comes from the fact that many charges are not labeled “taxes,” but they function just the same.
Vehicle registration now includes transportation improvement assessments. Utility bills contain state-mandated surcharges. At the pump, Californians pay not only a gas excise tax, but also costs associated with environmental regulations and cap-and-trade programs. Tire recycling fees, lumber assessments, stormwater charges, air quality district fees, and development impact fees — which ultimately raise housing costs — are layered quietly into daily life.
While courts distinguish between taxes and fees, to families paying the bill, the difference is often academic. If a charge is mandatory and unavoidable, it affects household affordability the same way.
Now policymakers are studying whether Californians should pay a new road usage charge — a per-mile driving tax — on top of existing gas taxes and vehicle fees. Recently, we also saw special state taxation applied to income earned by athletes and performers during major events such as the Super Bowl. These examples may seem narrow, but they reinforce a broader concern: when revenue falls short, the default solution is often another layer.
Meanwhile, we continue to hear that there is not enough funding for fire protection, infrastructure, schools, and emergency response. Californians are left wondering: if we are already among the highest taxed populations in the country, where is the disconnect?
We must have an honest conversation about whether government programs are effective and whether they still serve their original purpose.
Before asking residents to pay more, we should ask whether existing revenues are being spent effectively. Are programs meeting measurable goals? Are funds reaching the communities they were intended to serve? And when a program no longer delivers results, are we willing to reform or sunset it — or do we simply add another tax, fee, or additional program or department to fill the gap?”
Californians deserve full transparency on the taxes they pay. They deserve to know how much they are paying, how it is calculated, who they are paying it to and what they are getting in return. At a time when affordability is the defining issue for families across our state, we must be honest about the cumulative burden.
That leads to a simple but urgent question: When is it enough?
Understanding the full scope of California’s tax burden is the first step toward answering that question.
Rosilicie Ochoa Bogh represents the 19th district in the California Senate.