Last Saturday, October 10th was a very busy day for Gov. Jerry Brown as decisions were made on the status of multiple bills. The Governor of California vetoed a package of nine bills that would have created new tax credits for the state. Here is a list of vetoed Assembly and Senate bills:

WHAT’S OUT

  • A.B. 35 by Assembly member David S. Chiu (D-San Francisco) – Income taxes: credits: low-income housing: allocation increase.
  • A.B. 88 by Assembly member Jimmy Gomez (D-Los Angeles) – Sales and use taxes: exemption: energy or water efficient home appliances.
  • A.B. 99 by Assembly member Henry T. Perea (D-Fresno) – Personal income taxes: income exclusion: mortgage debt forgiveness.
  • A.B. 428 by Assembly member Adrin Nazarian (D-Sherman Oaks) – Income taxes: credit: seismic retrofits.
  • A.B. 437 by Assembly member Toni G. Atkins (D-San Diego) – Research and Development: Small Business Grant Program.
  • A.B. 515 by Assembly member Susan Talamantes Eggman (D-Stockton) – Income taxes: credits: food bank donations.
  • A.B. 931 by Assembly member Jacqui V. Irwin (D-Thousand Oaks) – Taxation: credit: hiring.
  • S.B. 251 by Senator Richard D. Roth (D-Riverside) – Disability access: civil rights: income tax credit.
  • S.B. 377 by Senator Jim Beall (D-San Jose) – Income taxes: insurance taxes: credits

Gov. Brown reminded everyone that when he took office in 2011, the state had a massive budget deficit. In his veto message, he explained that “Despite strong revenue performance over the past few years, the state’s budget has remained precariously balanced due to unexpected costs and the provision of new services…Given these financial uncertainties, I cannot support providing additional tax credits that will make balancing the state’s budget even more difficult.” The Governor wants to bring financial stability to the state first before he can expand on the allocating its resources.

WHAT’S IN

Even though the Governor vetoed a handful of bills this weekend, California still offers some tax credits and incentives to aid in business growth and success. These are the ones we see regularly:

California Competes Tax Credit Program: This program offers California-based businesses an income tax credit if they’re looking to expand, or for non-California organizations looking to relocate to the Golden State. In 2015, the state has more than $100 million in tax credit available through this program. To learn more about California Competes Tax Credit Program, click here for our previous blog.

California Manufacturer’s Exemption: The state offers a partial sales and use tax exemption to qualified manufacturing and biotech companies. The partial exemption rate is 4.1875% and applies to purchases of manufacturing and research and development. To learn more about California Manufacturer’s Exemption, click here for our previous blog.

California Film & Television Tax Credit Program: Created in 2009, this program provides a tax credit equal to 20-25% of a company’s income tax and/or sales and use tax for eligible film and television productions. The program originally had an allocation of $100 million. However last year, California Gov. Jerry Brown signed Assembly Bill 1839, which has increased the amount available for the program to $230 million for 2015-2016 and $330 million for each year between 2016 -2020. To learn more about California Film & Television Tax Credit Program, click here for our previous blog.

 

Gov. Jerry Brown tax credit tax credit program