This one had me stumped at first. Certain tax changes were agreed upon between the legislature and the governor in 2008. These changes included various ways for corporations to finagle their tax burdens. One method being to shift net-operating-losses to previous tax years and get refunds, another being to choose which formula gets used to calculate their taxes (however they want from year to year). Proposition 24 is to repeal those changes before they go into effect and keep the tax law as it was in 2009.
The analysis provided by the state didn’t give me any obvious arguments for or against. It ends up in the realm of nuanced business accounting. So I was having a hard time trying to form an opinion on the matter. The paid-for arguments were both sensationalist and lacking any real foundational evidence, so they were of no help.
The next step then, is to follow the money. And here is where the decision became easy.
The following data comes from ballotpedia.org.
In favor of proposition 24 means repealing the new tax laws which created more flexibility in corporations’ tax burden. This side has raised over $13 million with donations from such groups as the California Teachers Association, America’s Families First, National Education Association, Alliance for a Better California, and the California School Employees Association.
Against proposition 24 means keeping the new tax laws. This side has raised over $14 million with donations from such groups as Viacom, Cisco, Time Warner, Disney, Genentech, FOX, CBS, General Electric, DirecTV, and Pfizer.
That pretty much sealed my vote. If it’s worth over $1 million a piece to these companies then I can only assume it’s because they each intend to benefit by more than that. And my experience is that the companies on that list (and pretty much all companies) have never sought to reduce their prices and help out their customers simply because they ended up with extra cash in their pockets.