McNerney: Californians pay more to D.C. than we get back. Here’s a way to help with that.

California is a “donor” state. Each year, we pay more — lots more — to the federal government in taxes than the state receives in return.

Californians, on average, paid about $29 billion more a year in federal taxes than the state received over the past decade. That’s the largest imbalance in the nation.

By contrast, there are about 30 states that receive more money from the federal government each year than their residents pay the IRS. A large portion of the extra money these 30 states receive comes from the federal taxes Californians pay.

In other words, California “donates” billions of dollars each year to about 30 other states.

Californians are increasingly aware of this imbalance and frustrated about it. When I talk to voters, it’s a topic that comes up often: “Can California send less money to the federal government?”

As chair of the Senate Revenue and Taxation Committee, I decided last fall to start examining ways that California could address this problem. I met with several tax experts and began devising potential solutions.

It’s important to note that the State of California doesn’t pay taxes to the federal government – rather, individual California taxpayers do. And individual taxpayers can’t start paying fewer taxes to the IRS – not without getting in legal hot water.

So, any solution we came up with would have to legally reduce Californians’ federal tax payments.

We hashed out a few ideas and settled on an innovative one that could work. If enacted, it will reduce Californians’ federal tax burden by up to an estimated $250 million annually. Plus, it would provide Californians with a tax incentive to buy a new car, truck, or other motor vehicle.

Our idea, Senate Bill 1275, would eliminate the state sales tax you pay when buying a motor vehicle and replace it with a one-time vehicle license fee of an equal amount that is federally tax deductible.

For the full op-ed, click here.