Salt Report 3557– On December 1, 2014 Senator Bob Hertzberg introduced Senate Bill 8 describing conceptual reasoning for expanding sales and use tax impositions in California to include services.
“California’s two trillion dollar economy has shifted from being mainly agricultural and manufacturing in the 1950s and 1960s, when the framework of today’s tax system was set, to one based on information and services, which now accounts for 80 percent of all economic activities in the state. To achieve a future as promising as California’s past, we need a tax system that is based on this real economy of the 21st century while ensuring that new revenue is invested in strengthening the ladder of mobility for all our residents.”
The Upward Mobility Act seeks to make three broad changes to the tax code:
- Broaden the tax base by imposing a sales tax on services to increase revenues.
- Enhance the state’s business climate and incentivize entrepreneurship and business creation by evaluating the corporate income tax to determine whether it is meeting its intended purposes…
- Examine the impacts of lowering and simplifying the Personal Income Tax while maintaining progressivity.