In an L.A. Times story today on Jerry Brown’s tax and spending proposals, a business reporter writes:
Brown also is going after a third business benefit. He wants to raise $1 billion by ending a corporate tax break approved by state lawmakers in early 2009. The legislation, which took effect this month, allows multistate and multinational corporations that operate in California to choose each year between two methods of calculating their state income taxes, whichever results in the lower payment.
Instead, Brown wants to require that all companies pay taxes based solely on their sales in California and not on a formula involving in-state sales, real estate holdings and payroll size.
Some business and trade organizations that successfully defeated a fall initiative to repeal the corporate income tax break criticized Brown’s plan. A change in tax policy would create uncertainty at a time of continuing national economic weakness, they said.
Now, I know that Frank Luntz has successfully substituted “uncertainty” as the preferred American English term for “higher taxes on wealthy individuals and businesses.” But this reduces the practice to absurdity. Instead of calculating their taxes twice and paying the state whichever number is lower—the whole point being that this isn’t known in advance—businesses will be asked to calculate their taxes just once, on a single schedule. Saying that the result would be to “create uncertainty” makes as much sense as when a conservative news service unwittingly renamed runner Tyson Gay as “Tyson Homosexual.”