The Governor’s Office of Business and Economic Development (Go-Biz) hosted a local workshop on its new California Competes Tax Credit. Following the dissolution of the state’s Enterprise Zone program in 2013, new programs have been created in its place under the Governor’s Economic Development Initiative (GEDI). GEDI consists of the following three main components:
Manufacturing Equipment Sales Tax Exemption
Beginning July 1, 2014, specified manufacturing equipment purchases, up to $200 million per taxpayer, will be exempt from California’s 4.19 percent portion of state sales tax. The tax exemption will be available anywhere in California, not just in designated zones.
New Employment Credit
Beginning Jan. 1, 2014, employers who operate in designated areas, those with high unemployment or poverty rates, will be given employee wage tax credits upon hiring new employees, that meet certain qualifications, and results in a net increase in the total number of full-time employees.
California Competes Tax Credit
Beginning Jan. 1, 2014, Go-Biz will be authorized to negotiate individual tax credit incentive agreements with employer taxpayers that want to relocate or expand their business in California.