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PROVIDES PERMANENT FUNDING FOR SCHOOLS AND HEALTH CARE BY EXTENDING EXISTING TAX ON HIGH INCOMES. INITIATIVE CONSTITUTIONAL AMENDMENT.

 

OFFICIAL TITLE AND SUMMARY

PREPARED BY THE ATTORNEY GENERAL

  • Makes permanent the existing 2012 voter-approved tax rates for high-income Californians, currently set to expire in 2031.
  • Rates apply to income over about $371,000 for single filers, $742,000 for joint filers, and $505,000 for heads of household (2025 levels; adjusted annually for inflation).
  • Allocates tax revenues 89% to K–12 schools, 11% to community colleges.
  • Allows local school boards to decide how revenues are spent; bars use for administrative costs.
  • Increases General Fund revenues available for health care, budget reserves, and other programs.

SUMMARY OF LEGISLATIVE ANALYST'S ESTIMATE OF NET STATE AND LOCAL GOVERNMENT FISCAL IMPACT:

  • Maintains $5 billion to $15 billion of annual state income tax revenue by making a temporary tax increase on high-income earners permanent instead of letting it expire in 2031.