Study finds corporate tax breaks are ‘corporate welfare’

by CalWatchdog Staff | January 31, 2013 4:12 pm

Jan. 31, 2013

By Katy Grimes

A new study just released by the Howard Jarvis Taxpayers Foundation[1] and the Reason Foundation[2] found many California tax breaks given to corporations constitute corporate welfare, shows how they actually impede economic growth, and contribute to the state’s nasty political environment.

“The study examined numerous corporate tax, sales and use tax credits, tax deductions and exemptions in order to evaluate whether California tax breaks serve their intended purpose,” the press release said.

“The study reveals that while tax breaks may be intended to serve as an economic engine, they often become wasteful corporate handouts with the government attempting to pick winners and losers, often at a steep price tag to other businesses in the marketplace or ultimately, taxpayers,” the HJTA website said[3].

“Our study reveals what we have long suspected,” said Jon Coupal, Chairman of the Howard Jarvis Taxpayers Foundation[1].  “Special interests in Sacramento get special favors in the form of tax loopholes, usually at the expense of citizen taxpayers, small businesses and working class Californians.  Many of these corporate rent seekers are the same ones who finance initiatives and support legislation imposing broad-based tax hikes on everyone as long as they get to preserve their special tax treatment.”

“There are many ways to turn around the California’s fiscal and economic fortunes—cutting spending, eliminating burdensome regulations, privatizing government services, ditching boondoggles like the California high-speed rail plan, implementing real pension reform,” Adam Summers of the Reason Foundation reported.[4]

Download the study[5]. CalWatchdog will follow up on this very interesting study.

  1. Howard Jarvis Taxpayers Foundation:
  2. Reason Foundation:
  3. HJTA website said:
  4. Reason Foundation reported.:
  5. Download the study:

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