Schwarzenegger considering service tax?

SACRAMENTO "Golf lessons are always a 'want.' Some of us consider it a 'need'. I would say if it's a 'want', it would have to take a back seat," said golfer Jeff Baldo.

And women seeking that perfect coif might cut back on salon visits.

"Whose wallet really wants to pay taxes? Nobody likes to pay taxes," said hair stylist Jennifer Butler.

A sales tax on car repairs, health club memberships, landscaping, accounting work and lawyer fees is gaining traction at the state Capitol. In fact, sources outside the Schwarzenegger administration say the governor's aides are feeling out the business community behind closed doors and asking members what kind of taxes they would resist the least.

The governor's office denies it's laying the groundwork for raising taxes.

"He's open to people coming and talking about all their ideas. He's open to having a debate about raising taxes ... and explain to them why he thinks it's the wrong way to go," said Governor's Press Secretary Aaron McLear. "But the governor is not having meetings about the eventuality of raising taxes."

The usually anti-tax business community might be swayed if there were long-term fixes to the budget crisis. Some say if the governor got the business community behind him on raising taxes, Republicans would go along, but not even that would change their minds.

"When it comes to tax policy, the worst thing the government can do is increase taxes in the face of a declining economy," said Assemblyman Roger Niello, R-Sacramento.

To avoid severe cuts to education, polls show more Californians are coming around to the idea of raising taxes to lessen the blow.

"We live here in California. We reap the benefits of everything that comes from our government. So sometimes we have to help them out too," said Merrill Domondon, a tax hike supporter.

Many other states already tax services, so it's not an unusual idea. But keep in mind, California already ranks fourth in the country for tax burdens per household.


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