California Assembly Bill AB999

California 2017-2018 Regular Session

• Introduced: 2/16/17
• Refer: 3/27/17
• Report Pass: 3/28/17
• Refer: 3/29/17
• Failed: 2/1/18

Caption

Income taxes: credit: small business investment.

Impact

If enacted, AB 999 is expected to positively influence state laws related to taxation for small businesses. By allowing tax credits, the proposed legislation seeks to reduce the economic burden on investors while incentivizing the growth of small businesses in California. Furthermore, the Governors Office of Business and Economic Development will monitor and report annually on the effectiveness of the credit, offering insights into how such incentives affect investment levels and job creation within the state.

Summary

Assembly Bill 999, introduced by Assembly Member Burke, proposes amendments to the Revenue and Taxation Code, specifically impacting the Corporation Tax Law and Personal Income Tax Law. The bill aims to implement a tax credit for qualified investments made by investors and funds in qualified small businesses, offering a credit equal to 25% of the investment amount per taxable year for a specified time frame. This initiative intends to encourage investment in smaller enterprises, potentially stimulating economic growth by enhancing business funding opportunities.

Sentiment

The general sentiment surrounding AB 999 appears to be supportive among pro-business advocates who emphasize the need for financial assistance to small businesses. Proponents argue that the tax credit will serve as a catalyst for investment, essential for the survival and growth of startups and small enterprises. However, potential concerns from critics could arise regarding the adequacy and distribution of these credits, primarily related to whether they effectively reach underserved businesses or merely benefit established entities.

Contention

Notably, the bill includes stipulations preventing certain individuals from claiming these credits, ensuring that tax benefits are directed toward genuine investments that support small businesses. This aspect could lead to discussions on the fairness and reach of the tax credits, raising questions about access for diverse and minority-owned businesses. Additionally, the requirement for annual evaluations by a consultant may highlight challenges and successes, contributing to ongoing debates about effective economic policy in the state.