| || |
New State Economic Development Incentives
Posted On: January 28, 2014
Often referred to as GEDI--Governor's Economic Development Initiative--the incentives are expected to assist existing businesses and attract new business to California. The new incentives include: 1) a sales and use tax exemption for manufacturing; 2) a biotech and R&D equipment credit; 3) a long-term unemployed tax credit for areas of high unemployment and poverty; and 4) a recruitment and retention incentive to attract new companies to California and expand existing companies, known as the California Competes Credit. GO-Biz, the Governor’s Office of Business and Economic Development, will administer the, California Competes, recruitment and retention incentive.
Whittier manufacturers may be interested in the new California Sales and Use Tax Exemption for Manufacturers under the GEDI as it will provide manufacturers an exemption on sales tax for purchases of specific equipment. Beginning on July 1, 2014, manufacturers may qualify to obtain a partial exemption of sales and use tax on certain manufacturing and research and development equipment purchases.
To be eligible under this new law, manufacturers must meet all three of these conditions:
• Be engaged in certain types of business, also known as a “qualified person.”
• Purchase “qualified property.”
• Use that qualified property for the uses allowed by this law.
Generally, qualified property includes:
• Machinery and equipment, including component parts and contrivances.
• Equipment or devices used or required to operate, control, regulate, or maintain the machinery.
• Tangible personal property used in pollution control that meets established state or local government agency standards.
• Special purpose buildings and foundations used as an integral part of the manufacturing process, or that constitute a research or storage facility. Buildings used solely for warehousing do not qualify.
Manufacturers are encouraged to speak with their business accountant to determine whether the business may qualify for the Sales and Use Tax Exemption. The tax exemption will be administered and managed by the Board of Equalization and more information can be found at www.boe.ca.gov/sutax/manufacturing_exemptions.htm#page=Overview. For more information on the other GEDI tax incentives, go to www.business.ca.gov or contact the City’s Business Development Manager, Angelica Frausto, at 567-9320 or email@example.com.
( GEDI PowerPoint )
| || |