CalChamber recently released its eighth semi-annual California Chamber of Commerce Poll and the results were clear- two-thirds of voters believe the country is headed down the wrong track, while a majority feel the same about California. While our state’s shortcomings grab all the attention, and deservedly so, there’s still areas where California is quietly getting is right.
Two bills currently moving through the state legislature show that our leaders want to assist some of California’s most important industries. The first is SB 485 authored by Senator Portantino. This bill would extend the Film and TV Tax Credit, authorizing the California Film Commission to allocate $330 million in tax credits each fiscal year from 2024-25 to 2029-30. California’s Film and Television Tax Credit Program contributed almost $21.9 billion in economic output over five years and supported more than 110,000 total jobs in the state, according to a study released by the Los Angeles County Economic Development Corporation (LAEDC).
The study findings show that for every tax credit dollar allocated, the state benefitted from at least $24.40 in economic output, $16.14 in gross domestic product (GDP), $8.60 in wages and $1.07 in state and local tax revenues. The program also returned to state and local governments an estimated $961.5 million in tax revenue. (a more in depth look at the credit can be found here).
The second bill moving through the legislature is AB 1951 whose primary author is Assemblymember Grayson. The bill provides a sales and use tax exemption for the purchase of manufacturing, and research and development (R&D) equipment, expanding investment and production opportunities in California.
AB 1951 will provide California manufacturers the opportunity to continue to lead and compete in a domestic and global economy that operates on razor-thin margins. Further, the bill will facilitate further innovation, production of wide-ranging goods, and provide high-quality jobs throughout California’s regionally diverse economies.
AB 1951 is important to California because the state currently ranks among the highest in the nation in state and local sales tax rates. While the base state sales tax rate is 6 percent, when combined with local and district portions, the sales and use tax rate can reach up to 10.75 percent. AB 1951 sends an important message: California is serious about retaining and attracting high-quality jobs and production. Every California manufacturing job supports at least 2.5 other jobs.
California’s problems abound. But some solutions do too.