The opinion piece “Tell legislators not to cut health services” (July 14) concerning state budget issues was unfortunately riddled with errors that will mislead readers. I’d like to discuss three of them.
The author spent much of the piece denouncing the benefits Chevron would get from the new single sales factor formula to determine a multi-state company’s income tax. Single sales factor can replace an old formula that raised a company’s income tax with every new job created here. This is a positive move for job creation and retention in California, but oil companies are specifically excluded from the single sales factor so Chevron is not impacted.
Regarding the issue of whether targeted tax reforms create jobs: A just-released study from University of Southern California economics professor Charles Swenson found the single sales factor option adopted last year will mean 144,000 jobs for California and in just two years will result in increased state revenue when considering the personal income tax and higher business taxes those jobs will bring along with them.
The op-ed author suggests state budget cuts will cost thousands of jobs, yet one of her identified solutions—a new tax on oil production—would eliminate almost 10,000 California jobs at a time when there are already 2 million unemployed people in the state. That’s not an answer to anything.
Surely, there are no easy decisions with the state’s huge budget deficit, but having the correct information at least allows for informed decisions.