Ah, to live and breathe the fine air of the Golden State. Of course, we’re also known as the state with one of the highest (and probably soon to be the highest) personal income tax rates in the United States. And then I read about proposals to give the entertainment/film industry a nice tax break:
The California Film Commission has released a 25-page study, What Is the Cost of Run-Away Production? Jobs, Wages, Economic Output and State Tax Revenue at Risk When Motion Picture Productions Leave California, in support of proposed legislation to provide a California tax credit of 12% on wages and other production costs for movies and TV shows.
What happens when you give someone a lower tax rate? If you want total tax revenues collected to remain the same, someone’s (or everyone else’s) tax rates must go up.
There is no such thing as a free lunch. Unfortunately, the Governator has said that he supports the proposals.
Thanks to the TaxProf Blog for pointing this out.