California Keep Our Promises Act: corporation taxes: apportionment: single sales factor.

(1) The Corporation Tax Law imposes taxes measured by income and, in the case of a business with income derived from or attributable to sources both within and without this state, apportions the income between this state and other states and foreign countries in accordance with a specified 4-factor formula based on the property, payroll, and sales within and without this state, except that in the case of an apportioning trade or business that derives more than 50% of its gross business receipts from conducting one or more qualified business activities, as defined, business income is apportioned in accordance with a specified 3-factor formula. That law, for taxable years beginning on or after January 1, 2011, allows a taxpayer to apportion its income in accordance with a single sales factor formula, except as provided, pursuant to an irrevocable annual election, as specified. That law also provides that sales of tangible personal property and sales of other than tangible personal property are in this state in accordance with specified criteria. This bill would, for taxable years beginning on or after January 1, 2012, instead require a taxpayer, except as provided, to apportion its income in accordance with a single sales factor, and would revise the provisions that determine whether sales other than tangible personal property occur in this state, including specific provisions for cable systems or networks. This bill would include a change in state statute that would result in a taxpayer paying a higher tax within the meaning of Section 3 of Article XIII  A of the California Constitution, and thus would require for passage the approval of 23 of the membership of each house of the Legislature. (2) Under existing law, the Department of Veterans Affairs has specified powers and duties relating to veterans and is required to provide the Legislature with an annual budget estimate. This bill would require the Department of Finance, based on the annual budget estimate provided by the Department of Veterans Affairs and other specified information, to determine the budget for the fiscal year for the Department of Veterans Affairs and direct the Controller to deposit that amount into the Keep Our Promises Fund, a continuously appropriated fund established by this bill. This bill would provide that the funds in the Keep Our Promises Fund would supplant the General Fund revenues appropriated to the Department of Veterans Affairs and would require specified additional allocations by the Department of Veterans Affairs regarding veterans' homes, small business loans for veterans, and the Veterans' Assistance Grant Program, which would be created by this bill.