You may remember that back in November, the Tax Foundation released its State Business Tax Climate Index, which ranked states based on the various tax systems companies need to work within. California businesses were less than thrilled the state ranked 48th out of the 50 states.
Because the report is intended to help lawmakers see areas where they could improve, we thought it would be interesting to take a look at ways the Golden State is both improving and declining.
Legislation California Businesses Appreciate
- The California Competes Tax Credit continues to be popular among California businesses. In fact, the state just provided various companies with $70.5 million in tax credits to expand and offer more jobs within the state’s borders.
- California continues to offer credits and incentives to films and television series. Like the California Competes program, this provides tax credits to projects that relocate to the state in an effort to bring business back to Hollywood.
Legislation California Businesses Criticize
- Gov. Jerry Brown and state legislators reached a deal to raise the state’s minimum wage to $15 per hour over the next 6 years. Although this means a raise for the 6.5 million residents currently earning less than $15 per hour, California businesses are worried they won’t be able to afford it. The sad truth is, it will probably force certain industries to invest in more robotic technology or relocate to another state.
As you can see, there are benefits for California businesses to stay within the state, although there are also serious concerns looming. As you consider options for your company, make sure you make informed decisions by working with a multi-state tax expert like Miles Consulting. In addition to providing you with a comprehensive snapshot of how your business will fare in a specific tax climate, we can help you navigate the system, apply for applicable credits and incentives, etc. Contact us to learn more!
Miles Consulting Group, Inc. is a professional service firm in San Jose, California specializing in multi-state tax solutions. Our firm addresses state and local tax issues for our clients, including general state tax consulting, nexus reviews, tax credit and tax incentive maximization, income tax and sales/use tax planning and other special projects, including the new California Partial Manufacturer’s Exemption for Sales Tax. To learn more, contact us today at www.MilesConsultingGroup.com.
