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State’s companies paying $10 billion in higher taxes
June 16th, 2009, 5:01 am · 26 Comments · posted by Jan Norman, small-business columnist
California businesses are paying almost $10.6 billion in additional taxes this year and next because of the state’s burgeoning budget deficit.
Trying to cut those deficits, the legislature has hiked taxes, accelerated payments of existing taxes and suspended deductions, says the California Chamber of Commerce.
Still, the deficit stands at $24.3 billion.
Here’s how the CalChamber pencils out the increased costs to businesses:
* $2.5 billion by requiring businesses to pay 20% strict liability penalty on top of existing penalties for underestimating tax liabilities of $1 million+. The extra penalty went into effect June 1. Businesses will tend to overpay their taxes giving the state an interest-free loan with no deadline for refunds.
* $2.4 billion for additional sales and use taxes because of the 1-cent hike starting April 1. Businesses pay 40% of sales taxes, the chamber says.
* $2.3 billion because of a requirement that instead of paying estimated income taxes in four equal payments, businesses must pay 30% in each of the first two quarterly periods and 20% in the last two.
* $1.6 billion because businesses cannot deduct net operating losses for the 2008 and 2009 tax years. Very small businesses are exempted.
* $1 billion for the 0.25% hike in the personal income tax. This one impacts businesses that are limited liability companies, Subchamber S corporations and partnerships because profits are passed to the owners who pay taxes on them through their personal tax returns.
* $900 million for a two-year limit on all business tax credits including research and development and enterprise zone credits. The cap on credits is half the taxpayer’s liability.
* $425 million for increased vehicle license fees. Businesses pay approximately 25% of these fees.
* $360 million by requiring limited liability companies to pay their annual fees during the first six months of the current tax year. The new deadline may result in some businesses having to make a double payment. If a business underestimates the fee owed, it will pay a 10% penalty.
Click here for more details.
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The liberals will turn this state into the next Michigan. Keep voting them in and businesses will conitinue to leave. Who will pay for all yuor entitlement programs and bloated union pensions then?
More companies that will pick up and go to another state or overseas thanks to California over spending.
Taxing our way to prosperity!
Do the idiots in Sacramento really think this is good for California’s economy? If they do, they at stupider than I thought.
Righty, politicians stupidy knows no bounds.
The budget deficit is a joke. Our state legislature just can’t stop spending money. The budget is full of pork. But our elected officials only want to cut funding for schools, fire and police services, thereby punishing the people and businesses for thier ever growing desire to spend our money. While businesses are filing for bankruptcies at an alarming rate and unemployment is also spiraling, thier solution is more taxes.
I’m not much of a party politics person but it has become very clear that;
Liberal Democrats = HIGHER taxes
Consevative Republicans = LOWER taxes
I hope every taxpayer/voter will stop putting anyone who wants to expand government spending into office. This has to stop
Every measure brought to the voters that would raise taxes has been turned down, although we keep putting money spending legislators in office. It is time to stop this insanity and start voting responsibly. Other states get by with far less per capita than Calif.
Our Governor was elected to reverse the overspending but has caved in to liberal spenders.
The only way to stop them is to vote them out. I encourage every voter to examine the candidates the same way they have been examining the money spending measures. Otherwise we will all become state dependents.
Stupid voters have voted in stupid politicians. The sad part is that this stupid set of people think they are doing good things and blame others for problems they have created. There’s just no accountability. Are there any smart and responsible people left in California?
Don’t worry, the blueberry commision take care of everything.
Yay insolvency!
The wife and I are heading for Oregon thanks to Kalifornias high taxes and very toxic attitude towards businesses and tax payers
We are following the words of the Great Democrat Liberal Speaker of the Kalifornia house Slick Willey Brown
” IF YOU DONT LIKE THE WAY THINGS ARE DONE IN CALIFORNIA? MOVE!!!!”
So Mr speaker we are taking your advice and are moving
Maybe those gangstas that rioted on Sunday can save the state
Isn’t Oregon more “Liberal” than Kalifornia?
We can spend money on prisons or schools. Which would you like to reduce?
We can collect taxes on gasoline or milk. Which one do you want to raise?
We can have a government with police and firefighters or not. Do you want a government or not?
“I’m not much of a party politics person but it has become very clear that; Liberal Democrats = HIGHER taxes
Consevative Republicans = LOWER taxes”
Liberal Dems = tax to pay for gov’t services
Conservative Pubs = borrow to pay for gov’t services
What passes for conservatism these days is a joke. Conservative Bush cut taxes in wartime, growing the deficit and borrowing from the Chi-Coms to pay for his little misadventure.
How can one cut taxes, grow spending, borrow to pay for it all and call themselves conservative?
But nooooo, it’s always the GD liberals screwing everything up!
Yea, riiiiight
Yep, and then they cut the salaries of half of their employees and layoff the other half to make up the difference. So now people aren’t spending on anything because they are afraid that they will be next. So if the product isn’t on the shelf, no need to hire someone to put it there. No need for a manager to manage. No need for a shipping guy or people at the shipping centers. No need to distribute anything so you lay off the distributors too. And the downward spiral will continue until we are all on unemployment and the jobs have all moved out of state or out of the country. “Hope and change”…. yeah… Your employment statues is “changed” from “employed” to “unemployed”. You “hope” you can pay your mortgage. You “hope” you can find a new job….. Anyone think we need a government housecleaning yet?
**Poor businesses. It must be shocking to them that the state expects them to pay their taxes accurately and on time! What’s up with that?
Most California businesses will be heading to Nevada and Texas where there is no State Income taxes. Within 2 years California will be a Ghost State. There is no way in hell this state can survive. Disneyland may layoff Mickey Mouse and call it a day too.
Bit of advice “Move to another state!”
Raising taxes is not an answer, taxes will continue to go up until the people are paying 95% or more. No one in their right mine will live in the joke state! Plus there will be zero-jobs as most businesses will shut down or move out of the state.
I plan on moving to Austin, TX ASAP!
THE LATE GREAT CALIFORNIA - The next epic movie produced by Liberal Democrats!
Glad I bailed out of CA 4 years ago….somehow I saw this mess coming. Maybe it started with those blackouts when Enron was jacking up rates and purposely diverting available power away from CA. We really got jacked on that, which helped lead to the Davis recall, which led to Arnie, etc.
Yep, glad I got out of there.
I CAN SAY THIS THOUGH:
No matter where you go, things are not rosey ANYWHERE! And CA will somehow survive, it always does and people will always flock there from the midwest.
Correction Bryan…
Liberal Dems = BORROW AND tax to pay for gov’t services (you don’t need)
O has TRIPLED the Bush deficits! We are running close to a 2 TRILLION dollar national deficit this fiscal year. Are you complaining about that? Didn’t think so.
Big spenders on both sides need to go. The goodies for votes scheme needs to go. Unfortunately, that takes integrity and none of of leaders from the President on down has any.
Much of O’s spending was already in the pipeline prior to his admin., the bank and wall st., and whoever became Prez would have had to spend something to try and repair the mess left behind by Bush. So to call this Obama’s debt seems unrealistic to me.
The debt was going to have to shoot way up this year, no matter what, as a result of the cleanup taking place.
But you are correct in that all both parties are needing a shake up. They are in it for themselves, they mis-manage our tax money. We can go join the green party or something but there’s too many lemmings in America to ever get a viable option other than Dem or Pub.
Sure, now everybody suffer of short memory
Do you all remember the “Re-call” of the existing Governator?
Do you all remember the Big Loan from washington, that everybody embrace…by saying “Oh Arnold is great!!”
Well guys Arnold help to sink the state further down
Review the info from “CalChamber’s”, Business pay the taxes… This is plainly not true. The customers pay the taxes one way or another for the product purchases. A simple test - consumer stops buying product, no business, no taxes.
They (the legislature) couldn’t balance the budget even during properous years. We ALL should have seen this train wreck coming!
I also noticed car registration was up again… one of my cars almost doubled and the other one is 1/3 higher that it was when I first bought the car last year…. Don’t these guys ever learn? The last governor got booted because of this…
More good news-Washington sent a denial to Arnold for help for CA deficit.
It appears that almost half of the deficit is going onto the backs of CA businesses. Individuals will be next-wait for the bills that personal taxes are due every 3-6 months instead of yearly. Wait for the repeal of Prop 13. Who knows what else is coming down the pike.
Wouldn’t it be better if the districts were enlarged so that there were fewer legislators in Sacremento? And wouldn’t it be great if all the old fat cats were replaced with younger tech-smart candidates? People that understand today’s rules and needs. Then eventually the schools would use netbooks not textbooks, classes could even go virtual in the higher grades, as in some college courses. It’s been shown that the student’s attention span is greatly improved by using a PC. The Encyclopedias are now on disks. A student can flip between assignments and references in seconds, and so on. The teachers unions won’t like the new changes because fewer would be needed-so only the cream of the crop would survive.
The penal system is another outdated system Let the Gov follow through with his threat to send the lot to the Federal institutions. The penal unions should then have to renegotiate all contracts, because the welfare of the state is in jeopardy.
It will take younger lawmakers with real actuarial, IT experience, and a lot of hard work to resurrect California. A new breed that actually calculates the risks of the existing benevolence for each program in effect now.
Being a senior citizen doesn’t keep me from being disgusted with the Old Bunch. We need new solutions.
I wish that each voter would demand the voting and attendance records of their district incumbents, and not accept the marketing gimmicks that have always been mailed out. We shouldn’t settle, we are smarter than that.
California is in deeeeep trouble, and if our reps are going to continue to work the same old tricks why would we expect any different results?
Saw this coming, so I bailed from California Taxing me to death. Now live overseas for 10-15% of cost of living in the taxed till it hurts state. I’ve seen business departing for years, now more will follow. The California Illegal welfare society will end up broke. Stay in CA = work an additional 10 YEARS to be able to just survive; depart= retire NOW and be happy with sufficient income for life.