Not To Flog a Dead Horse

Last fall, we argued that it appeared that the recommendations of the Commission on the 21st Century Economy (COTCE) were not, in fact, revenue neutral and that the proposed Business Net Receipts Tax would raise less than the tax that the Commission proposed to reduce or eliminate. In testimony before the Assembly Revenue and Taxation Committee yesterday, the Legislative Analyst’s Office (LAO) concurred with this analysis and estimated that the COTCE proposal would leave the state $10.2 billion short. With the long-term forecasts by both the LAO and the Department of Finance projecting red ink as far as the eye can see, that’s yet another reason why the COTCE proposals are a bad bet for California.

— Jean Ross

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