Call to Action - Proposal makes businesses into tax collectors and forces small biz to make interest-free loans to state.
California continues to have a severe budget crisis - $20 billion in the hole. Unfortunately, one of the solutions being proposed in Sacramento is yet another budget gimmick - an onerous 3% independent contractor withholding mandate on businesses and public agencies.
Any business/agency hiring an independent contractor (anyone who receives a 1099-MISC) will have to reduce every payment by 3%, and is responsible for remitting that money to the Franchise Tax Board, the state tax collection agency.
- Almost all companies, agencies and non-profits of any kind will have to withhold.
- Almost anyone who receives a 1099-MISC will be withheld upon, including builders, plumbers, real estate agents, attorneys and health care providers.
Under This Proposal:
- The 3% will be withheld even if the business owes no income taxes for the year due to losses/slim profit margins.
- The state gets to use the money-interest free until tax return time the next year.
- Money is taken out of the pockets of businesses that is needed to keep business afloat, make payroll and pay bills.
- Implementation will be extremely costly and complex for businesses and state and local government agencies.
- The mandate is ongoing and permanent for businesses/agencies.
All for a one-time money grab that is merely an acceleration/borrowing that generates very few new revenues for the state!
Call to Action:
- Add your business's name to the growing coalition against this proposal! To be added, simply e-mail laurie.lively@calchamber.com. Your business's name will be added to the coalition fact sheet.
- Write or call your legislators in the Assembly and Senate. Visit CalChamber's grassroots page to view a sample letter and/or look up your legislators' phone numbers.
- Spread the word. Forward blog and the fact sheet to other businesses that should be concerned.
Thanks for your help!
Thank you for stopping by. Your comments on this post are welcomed and appreciated.
No one sold more homes in Del Norte County in 2009--*both in number and volume--than Fran Gatti. Put Fran to work for you!
 |
Brought to you by Fran Gatti at |
*PER CCMLS
Well...California has dug itself into a really big hole. These measures are just "kicking the can" down the road. At some point much of this money will have to be refunded. With what...more IOU's? I agree that sucking more money out of the private sector will certainly not help our economy. Lots of talk lately about the PIGS (Portugal, Italy, Greece & Spain) but at some point there are at least 7 US states rapidly moving toward insolvency not to mention the municipalities within them. I predict lots of Chapter 9's starting in 2010. ~Doug
We are led by blithering idiots...seemingly at all levels and in all venues.
OH YEA...that's going to stimulate the economy. Next we will be paying taxes on the money we not made yet!
Sad state of affairs. Sad that we elected these moron's and even sadder that we keep re electing them. Perhaps the voters will wise up and clean house regardless of the political party and let's start anew with some business savy leadership.