The twin tax hikes by Gov. Jerry Brown was approved by California voters to avoid the state's public universities hiking college tuition fees.
Immediately after the proposal was passed, Governor along with several state university officials announced immediate roll back in tuition rates.
The sales and income tax hikes passed with 54 percent to 46 percent voters' approval will prevent the public universities from increasing the tuition fees.
A 9 percent tuition hike, raising annual fees by $249 per semester for 2012-2013 academic year, was approved by California State System board of trustees last year to meet the $250 million mid-year budget cuts.
But, with the tax hikes, the nation's largest four-year network, 23-campus Cal state system will avert this budget cut.
Thanks to the California voters, this year's annual tuition fees for full-time undergraduate students in-state will now revert back to $5,472, the same rate as in the previous academic year.
"The election last night was a clear and resounding victory for children, schools, and the California dream," Brown told a news conference.
"Instead of the state borrowing, hat in hand, from our school districts, we're going to have enough money to fund the schools as our constitution requires."
The measure, Proposition 30, raises the state sales tax by a quarter-cent for four years and increases income tax rates for individuals who earn more than $250,000 a year for seven years, and earmarks the resulting revenues for education.
The passing of the tax hikes is hailed as a huge victory for Gov.Brown. Persuading the California voters, who have not approved any tax hikes since 2004, was not a small feat.
Had Brown's tax measure failed, even smaller University of California system's UC- Berkeley and UCLA's tuition fees, with a total of more than 220,000 students, could have risen by as much as $2,400 per year.
"This victory will certainly help us in our battle to restore fiscal stability to the University of California," UC Regents Chairman Sherry Lansing said in a statement.
SOURCE: REUTERS