Senate Struggles To Find Compromise On Tax Hikes

SACRAMENTO (AP) — After a failed tax vote a day earlier, the state Senate was meeting to figure out how Democrats and Republicans could compromise on closing California's remaining $9.6 billion budget deficit.

Senators passed a few relatively minor budget bills early Saturday but did not touch the tax question.

Democrats want to extend temporary increases to the sales and vehicle taxes for one year. They say the action is needed to bridge a gap until voters can decide whether to approve higher sales, income and vehicle levies for as much as five years.

The tax measure needs at least two Republican votes to pass but received none Friday in the Senate.

GOP lawmakers said renewing the tax hikes will hurt the economy. They called for deeper cuts, pension reforms and regulatory relief.

(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)