"Corruptus in Extremis"
- Democrats exempt a "politically correct" electric car maker from taxes.
- Wealthy Liberals want to protect their ultra expensive $70,000 plus toy electric green car while the average politically incorrect business has to pay the full tax load to support endless government spending programs.
California will give Tesla Motors a $34.7 million tax break to expand the company’s production of electric cars and powertrains in the state, officials announced Tuesday.
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 powertrains 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 reports the San Francisco Chronicle.
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 exemptions are issued by the California Alternative Energy and Advanced Transportation Financing Authority, chaired by State Treasurer Bill Lockyer.
Tesla has received the exemptions before, on equipment worth up to $612 million. That equipment helped the company retool the former New United Motor Manufacturing Inc. plant in Fremont — which Tesla bought in 2010 — and launch the Model S last year. It also will help the company produce its next car, the Model X crossover SUV.
|Tax breaks for green energy companies,|
but full taxes for everyone else.
“I’m pleased we could take this action to encourage Tesla to expand its electric vehicle production in California, which will create green jobs and improve our air quality,” Lockyer said Tuesday, in a prepared statement.
That amounts to a $34.7 million tax break to produce more of a vehicle whose sticker price starts above $70,000.
California is worried about companies like Tesla picking up stakes and heading elsewhere.
Businessweek notes that new manufacturing jobs in the state have risen less than 1 percent since 2010, compared with nearly 5 percent nationally. Gov. Jerry Brown has been chipping away at the tax already, and Tesla is just the latest example.