By, Maria Aguilar |Staff Writer|
Businesses who operate in California and other states or countries will no longer be able to choose how their state taxable income is determined, if Proposition 39 passes.
Currently multi-state businesses choose one of two methods to pay their state taxable income.
Under method one, “the more sales, property, or employees the multi-state business has in California, the more of the business’ income is subject to state tax,” according to the official voter information guide. Method two specifies, the more sales from the business in California, the more income is taxed.
Proposition 39 affects only multi-state businesses and will require they pay state income taxes based on sales made in California.
The revenue will be used toward alternative energy projects for schools, public facilities, job training and development of programs geared toward energy efficiency and alternative energy.
This measure is estimated to raise $1 billion and up per year beginning in 2013, according to the official voter information guide.
A new nine-member board will be created to monitor how the money is used.
The revenue will be placed in a new state fund named the Clean Energy Job Creation Fund.
The funds transferred into this state fund will not be used to calculate the state required minimum amount of school funding for California.
California is required to fund a minimum level of state and local funding to public schools and community colleges each year, according to the official voter information guide.
Of the estimated $1 billion new annual revenue, it is projected $500-$550 million will be dedicated to energy projects while the remaining amount will benefit schools. This amount is projected to be $200-$500 million.