California dumps vet tax proposal

Sacramento, Calif.

-- A tax on veterinary services is officially off the table in California.

Legislators finally passed a 17-month budget during after overnight session Feb. 19 after months of negotiation. The final bill, approved by state Senate and Assembly, does not include a veterinary service tax included in previous versions of the budget proposed by Gov. Arnold Schwarzenegger.

The governor's plan was harshly criticized by veterinarians, who say the tax would have put a huge burden on pet owners and compromised public health. The California Veterinary Medical Association (CVMA) also opposed the tax on the grounds that it would have made veterinary medicine the only taxed healthcare service in the state.

"Requiring pet owners to pay a tax to care for their animals is bad public policy," says Bill Grant II, president of the CVMA. "We are pleased the members of the 'Big Five,' including the governor, recognized that and that the proposed tax was removed from the final budget bill."

The CVMA organized a large-scale grassroots campaign to oppose the tax, which was first proposed in November to help close California's $42 billion budget deficit. The veterinary service tax would have added about 10 percent to veterinary bills and, along with other non-medical service taxes, provided about $350 million in new revenue for the state.

"The opposition of veterinarians, pet owners and concerned citizens was so intense, a special extension was added to the governor's budget voicemail line to handle the opposition to the tax on pets," Grant says, adding thousands of calls and letters flooded the governor's office. "We believe the overwhelming number of calls delivered an emphatic message to the governor that taxing pet owners would be hugely unpopular and inequitable."

The California Legislative Analyst's Office, which reviewed versions of the state budget proposals agreed in a recent analysis, saying the veterinary tax would "create inequities in the tax structure by taxing some services while leaving other similar services untaxed."

A full version of the new budget was not available at press time, but it does include other tax increases outside the veterinary tax. There is no word yet on when the governor plans to sign the new budget into law.