Proposition 39 Tax Multistate Companies This proposition will require multistate companies that operate within California to pay income taxes based on a percentage of their California revenues.
Requires multistate businesses to pay income taxes based on percentage of their sales in California. Dedicates revenues for five years to clean/efficient energy projects. Fiscal Impact: Increased state revenues of $1 billion annually, with half of the revenues over the next five years spent on energy efficiency projects. Of the remaining revenues, a significant portion likely would be spent on schools.
- There have been accusations that Chrysler, General Motors, Kimberly-Clark and International Paper are not reporting political contributions to fight this proposition.
- There is only one other state that uses California’s current tax law. 8 states have adopted a mandatory single sales factor approach.
- Chrysler has publicly announced that it will not fight prop 39
If this proposition passes it will generate approximately 500 million within the next year and then should meet or exceed 1 billion after 2014. Money for school funding would be increased immediately. Money for energy project would begin in 2014.
- Do you want to increase taxes on multistate business?
YES vote- Multistate businesses would no longer be able to choose the method for determining their state taxable income that is most advantageous for them. Some multistate businesses would have to pay more corporate income taxes due to this change. About half of this increased tax revenue over the next five years would be used to support energy efficiency and alternative energy projects.
No vote- Most multistate businesses would continue to be able to choose one of two methods to determine their California taxable income.