(SACRAMENTO) – Legislation by Assemblymember Tim Grayson (D-Concord) to reduce the annual state taxes imposed on new small businesses passed with bipartisan support in the Assembly Revenue and Taxation Committee.
“As a small business owner, I know how important capital is when starting up. Allowing businesses to get a break on their tax filings while they are struggling to make any revenue is critically important,” said Assemblymember Grayson. “While everybody should pay their fair share, it makes sense that our tax policy nurtures rather than hinders the growth of small businesses that are just getting started in California.”
A small business, which often elects to form as a Limited Liability Company (LLC), is required to pay an annual fee of $800 in California regardless of its size or profit, causing a significant barrier to entry for small businesses.
Assemblymember Grayson’s bill, AB 2410, will cut the annual fee in half (from $800 to $400) in each of the first two years for new LLCs with gross income less than $250,000 – a tax break that will give many budding business owners a better chance to start up without undue burden.
AB 2410 is supported by Small Business California, the California Asian Chamber of Commerce and the California Coalition of Travel Organizations. The bill proceeds to the Assembly Appropriations Committee for further consideration.
Assemblymember Timothy S. Grayson represents the 14th Assembly District which includes the communities of Clayton, Concord, Martinez, Pittsburg, Pleasant Hill, Walnut Creek, Benicia, and Vallejo. For more information, please visit https://a14.asmdc.org/