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Assembly Passes Brown's Tax Package

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(Sacramento, CA)
Friday, September 9, 2011

The centerpiece of the agreement would require all companies that do business in California to base their corporate taxes on in-state sales.  That would cause many out-of-state businesses to pay more than they do now.  Governor Jerry Brown says that'll generate $1 billion a year - money that will go to tax breaks.  Brown praised the bi-partisan cooperation:

Brown: "This is a very important coming together of very disparate individuals and philosophical views to do something for California."

The proposed tax breaks would include a sales tax reduction on manufacturing equipment purchases as well as a series of other business tax cuts.  The package also includes a bigger personal income tax deduction.

Assembly GOP Splits on Brown's Tax Package

Legislative Republicans appear split on whether to support the governor's tax package.  Assemblyman Nathan Fletcher, who's running for Mayor of San Diego, was one of two GOP members who gave the measure its necessary two-thirds supermajority.

Fletcher: "Although it may not be perfect, it may not be ideal, it may not be exactly what everyone wants, we are trying to moving the ball forward because we hear from you that you're struggling."

But other Republicans either abstained or voted no.  Assembly Budget Committee Vice-Chair Jim Nielsen was one of the strongest critics.

Nielsen: "Taxpayer organizations and the conscience of taxpayers say this is a tax increase.  I say that this is a massive tax increase and that will not serve the citizens that we represent."

The package has support from the National Federation of Independent Businesses, which represents small businesses.  The California Taxpayers Association opposes it.

The measure still needs two GOP votes in the Senate to pass the legislature. It's unclear if it has that support. The bill faces a Friday deadline before lawmakers adjourn for the year.
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