By MOCH N. KURNIAWAN
Shoppers in the Mission District said Wednesday they were willing to tolerate the one-percent state sales tax hike that took effect today because they understand the state’s budget troubles.
“If I buy something for $30, one percent of it equals 30 cents. It’s small. We don’t really feel the hike,“ said Mark Austria.
However, Austria said, he would object if the tax went to finance the military or help salvage banks from bad-mortgage debt.
Amanda Frank, who had just purchased some clothes on Mission Street, and Nancy, a shopper on Valencia Street who asked that her last name be withheld, agreed.
“It’s not nice to hear [such a hike] because in this difficult time everyone needs money. But I understand the current budget deficit faced by the government,” said Nancy, after buying a book at Dog Eared Books. “What else can the government do?”
But Frank warned that the new sales tax may hurt those who buy big-purchase items such as cars.
In San Francisco, the sales tax rose to 9.5 percent from 8.5 percent.
Reports indicate that the California budget deficit will reach $42 billion in the current and next fiscal years.
To close the gap, the the state budget package includes tax increases, spending cuts and borrowing.
The state expects to generate $5.8 billion in revenue from the new sales tax, which will end July 1, 2011. Voters can extend it for one year if it is approved in the May 19 special election.
Meanwhile, store owners and managers said they had no choice but to implement the new sales tax. Many, however, disagreed with the tax strategy.
“Buyers will reduce spending initially, but later on they will get used to the new tax,” said Maisie Wong, store manager for A.C Trading on Mission Street. “Less buyers will hurt our business.”
Wong said it’s fine for the government to raise the sales tax when business is growing, but that in difficult times taxes shouldn’t be increased.
“If I could, I would ask the government to delay the sales-tax increase,” Wong said. “But we don’t have that choice, so it’s better for us just to work in whatever situation.”
Jorge Hernandez, a cashier at Rheas’ Deli and Groceries on Valencia Street, agreed with Wong.
“It’s a bad choice, but I prefer to see a sales-tax hike rather than people getting laid off,” he said.
Walter Kempinksi, a bookseller at Dog Eared Books, said books, clothes and other small items should’ve been excluded from the tax increase.
“Right now, common people need money to buy clothes, papers and books, so the sales-tax hike will make them rethink their spending,” he said, adding that it made more sense to raise taxes on luxury items.
“They [the rich] have more money so should be relatively ok with a tax increase.”