Written by Gordon Webster, Jr.
What is it with Sacramento and taxes?
First with the gas tax, the cap-and-trade scheme and now a proposed 3 percent tax on services purchased by Golden State businesses, you would think the state’s lawmakers are in a protracted effort to squeeze entrepreneurs for all they have before they ship off and move to Texas or Idaho.
The latest bill, SB 993, has been identified as a “job killer” by the California Chamber of Commerce. It would impose yet another layer of taxes onto California companies, raising costs and putting California enterprise at a competitive disadvantage.
The negative impacts of SB 993 — as the CalChamber points out — would hit small businesses the hardest. While there is a limited exemption for certain small businesses, not all are protected. While large businesses can bring some of those services to be taxed in house, small businesses don’t have that luxury.
In addition, small businesses that provide services will have to set up a new tax system within their companies. The higher prices for services will also undoubtedly cause some clients to explore other alternatives.
SB 993 is scheduled to be discussed by the Senate Governance and Finance Committee on June 13. Hopefully more business-friendly heads will prevail at the Capitol.