A car for the 1 percent gets another tax break in California:
California will give Tesla Motors a $34.7 million tax break to expand the company’s production of electric cars and power trains in the state, officials said this week.
Tesla, based in Palo Alto, won’t have to pay sales and use taxes on new manufacturing equipment worth up to $415 million. The equipment will help Tesla more than double the number of Model S sedans it builds at its Fremont factory, as well as assemble more electric power trains for customers such as Daimler and Toyota.
Tesla expects to build 21,500 sedans this year. The new equipment would help expand annual production by 35,000 cars.
California is one of the few states to tax the purchase of manufacturing equipment, a policy that California business associations have spent years trying to change. But the state does grant exemptions for clean-tech companies as a way to encourage the industry’s growth.
The state estimates that with the new purchases, Tesla will add 112 permanent jobs. And by increasing employment and, presumably, car sales, the state predicts that California will take in more than enough additional tax revenue to make up for the exemption. A report by the California Alternative Energy and Advanced Transportation Financing Authority predicts a $24.4 million net benefit to the state.
But if this particular tax break helps a “green” company, wouldn’t it also help every other company in the state?
The rest here.