California Governor Brown's tax, jobs plan advances

Reuters News
Posted: Sep 08, 2011 4:48 PM
California Governor Brown's tax, jobs plan advances

SAN FRANCISCO (Reuters) - California Governor Jerry Brown said on Thursday he has bipartisan backing in the state Assembly for a plan to rewrite a corporate tax law to raise roughly $1 billion a year that would be put toward tax incentives intended to spur job growth.

Brown last month unveiled the plan and has been promoting it across California, which had 12 percent unemployment in July, the second-highest rate in the country.

The Democratic governor's plan, backed by labor and business groups, involves scrapping the most populous U.S. state's dual corporate tax calculation method in favor of a single approach. It also would use revenue gains to provide tax breaks for small businesses and for purchases of manufacturing equipment.

Additionally, the state's standard personal income tax deduction would be expanded.

The proposed tax incentives are aimed at winning over Republicans in the legislature's minority whose votes Brown needs to overhaul how companies calculate their tax liability.

The plan now goes to the state Senate, where supporters will lobby hard for the handful of Republican votes it needs to clear that house as the legislature nears the end of its session on Friday.

(Reporting by Jim Christie; Editing by Dan Grebler)