California Gov, Jerry Brown recently issued his revised budget
proposal. In his proposal, Gov. Brown once again targeted the
Enterprise Zone program. However, rather than proposing to
eliminate the program in its entirety, the governor has chosen to
substantially restrict most of its benefits, including eliminating
benefits retroactively.
The two most significant benefits of the Enterprise Zone program
are the hiring credit and the sales and use tax credit (EZ
Credits). The hiring credit is a credit available to taxpayers who
hire certain qualified employees to work within an Enterprise Zone
area. The sales and use tax credit is a credit for sales tax paid
on purchases of machinery and machinery parts used to fabricate or
manufacture a product that is used in an Enterprise Zone area. Each
of these credits rewards taxpayers who invest in economically
depressed areas. However, the governor's proposal would
substantially limit these benefits.
