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Services Will Be Affected By Sales Tax

Governor Arnold Schwarzenegger wants to extend the sales tax to many services as a way to generate revenue for cash strapped California. Schwarzenegger unveiled his proposals earlier this month to hel

Services Will Be Affected By Sales Tax

Veterinary services, car repairs, golf fees…Governor Arnold Schwarzenegger wants to extend the sales tax to those services and others as a way to generate revenue for cash strapped California. 

Schwarzenegger unveiled his proposals earlier this month to help fill an $11-billion shortfall this year.  As Jenny O'Mara reports, the plan is getting a mixed response.

Doctor Richard Strasser (STRAW-sur) is taking a look at Tookie-a four year old black chihuahua mix.  He's rubbing an ultrasound wand over Tookie's belly.

Strasser: "You know it's really nice here for the practice because we're a paperless office and this ties into the computer software. "

Strasser practices at a Sacramento-area pet hospital.  It's only been up and running for three months.  He believes the Governor's plan to extend the sales tax to vet services will cause owners to delay getting care for their pets.

Strasser:  "It just makes sense especially if it is pets, saying oh well we can put the shots off 'til next month, oh the pet doesn't need heartworm medicine because that means we have to go to the vet.."

Republican lawmakers used the new pet hospital as a back drop yesterday (Thursday)  to speak out against the Governor's plan. 
Among them was Roger Niello, who's vice Chairman of the Assembly Budget committee.  He says expanding the sales tax will only do more damage to the ailing economy.

Niello: "Whatever we do, let's not make the economy worse, let's not impose a solution that will have us back here six months from now because the solution doesn't work."

The state share of the sales tax is currently five-percent. The Governor wants to raise it to six-and-a-half percent.

The State Department of Finance says the Governor's plan to extend the tax to services would eventually bring in more than one billion dollars in revenue.

Out on the driving range, golfers are a bit more resigned to the possibility they could pay more to play.  Mike Zanders says he won't quit hitting the links-he'll just find someplace cheaper.

Zanders:   "It's a luxury I guess, playing golf and people who play golf usually have the money. They just keep hitting us everywhere you know?"

Negotiations on the budget are continuing between the Governor and legislative leaders almost daily, but so far no deal. Time is running out-- the session ends for the year in less than two weeks.