California will not institute a sales tax on veterinary services for the current state budget, as had been proposed by Gov. Arnold Schwarzenegger late last year.
But California veterinarians might not be spared in the next budget, according to Dr. William Grant, president of the California Veterinary Medical Association (CVMA).
“We have been told it is still on the table,” Grant said.
The current budget, which passed last week after months of legislative haggling when three republicans in each house joined the majority democrats, runs through June 2010. It is the budget that follows that might include a sales tax for veterinary services.
Grant said that he was told the possible sales tax might include physicians and dentists as well as veterinarians.
This year's rejected proposal rescinded the sales tax exemption for veterinarians that is usually given to services, as well as an exemption for a few other services such as appliance and furniture repair, vehicle repair and golf.
The tax instituted would have increased veterinarian charges by 10 percent for those services affected.
But lumping veterinary appointments and treatments with golf and furniture repair did not sit well with many veterinarians and others, and in part, might have contributed to strong protest against the veterinary proposal.
According to a statement released by the CVMA, its 6,000 members sent thousands of letters to elected officials in opposition to the proposal, as did many of their clients. The opposition was so stiff the governor’s office had to set up a separate telephone extension to his budget voicemail just to handle the calls objecting.
“Over three months ago, the CVMA launched a massive campaign to oppose the governor’s proposed tax increase on veterinary services. Today we prevailed,” the statement said.
The state’s Legislative Analyst’s Office (LAO), a non-partisan advisor to the state government, weighed in against the proposal as well. The LAO said the proposal would have created “inequities in the tax structure by taxing some services while leaving other similar services untaxed.” Such inequities are to be avoided, the LAO said.
The new budget does increase taxes in the state, just not veterinary-specific taxes. It includes a 1-cent increase in the state sales tax and an increase in income tax.