PROP 24 IN BASIC TERMS:
Prop 24 repeals $1.3 Billion in annual corporate tax breaks slated to begin in 2010.
The initiative targets "breaks" approved by Governor Schwarzenegger in 2008.
This would repeal the following breaks:
- Allowing businesses to shift current economic losses to prior tax years, AND extending the period normally allowed to shift operating losses to future tax years. (Without repeal, companies could receive tax refunds for taxes paid up to two years ago.)
- Allowing companies "to share" tax credits with affiliated corporations.
- Letting companies choose how their taxes would be calculated.
The options are whether to base off a portion of their total sales" in California,
or a combination of sales, operations, property, and payroll.
ARGUMENTS FOR A YES ON 24:
- Less than 2% of California businesses benefit from these tax breaks. This 2% are "wealthiest, multi-state corporations."
- Prop. 24 makes big corporations pay their fair share.
- Repeal projects increased state revenues by roughly $1.3 billion per year.
The state budget needs the funds these corporations otherwise get to keep. Without them, the tax burden is heavier individual taxpayer.
- When school budgets are being “slashed by $17 Billion and 26,000 teachers are facing layoffs, now is not the time for state tax breaks to large corporations.
- The deal resulting in the corporate tax breaks "was done behind closed doors."
ARGUMENTS FOR A NO ON 24:
- Many larger companies, including Disney oppose.
- California already ranks 48 out of 50 for worst business tax climates in the USA.
- "It will cost California 144,000 jobs.” Businesses who can't afford the tax will go bankrupt or leave the state.
- California needs more jobs. A tax on businesses reduces the ability to create them.
- Per "Stop the Jobs Tax", "the initiative taxes new job creation, hits California employers and small businesses with higher taxes and stifles job growth. It would lead to fewer jobs and fewer tax revenues."
- "Proponents failed to include language to guarantee proper expenditure of the tax increase, leaving it up to the same politicians who misspent us into debt."
PROP 24 A SUMMARY:
Y - On Prop 24 means repealing generous corporate tax breaks.
N - On Prop 24 means allowing generous corporate tax breaks.
Also watch ABC7's coverage on this item.
Labels: 2010 california ballot measures