Tesla Motors, much like SpaceX, has recently received a lot of money in sales tax incentives. A tax incentive is a feature of a tax code that aims at encouraging an economic activity. It was officially announced by California State Treasurer John Chiang. He says that Tesla Motors will be receiving $39 million in tax incentives.
TESLA MOTORS RECEIVES TAX INCENTIVES
This is great for Tesla Motors because these tax incentives will benefit them in advanced manufacturing, as well as alternative energy. This program that Tesla Motors now has will exclude them from using taxes for buying equipment, as well as paying sales. Tesla Motors, along with another company run by Elon Musk, actually received the most money from this program. $100 million is awarded each year, and $39 million of that went to Tesla Motors. SpaceX also got a nice chunk of that money.
SPACEX ALSO RECEIVES TAX INCENTIVES
Musk has certainly gotten the most out of this program. As stated previously, he also runs SpaceX. SpaceX is the Space Exploration Technologies Corporation. Earlier this year, SpaceX actually received around $30.3 million in tax incentives from this program. So, $69.3 million of the possible $100 million for the year was received by Musk. Not too shabby at all for Musk.
THE PROGRAM THAT TESLA MOTORS RECEIVED TAX INCENTIVES FROM
The executive director of the agency chaired by Chiang, Deana Carrillo, talked about the tax incentive program. Carrillo states that this program is intended to advance the pool of the most prominent jobs in California. However, she stated that it is unlike other programs that will lure companies in with huge grants of money. She points out that the program does not write the company a check. Rather, it allows them to get a benefit after they have all of their financing correct. This is not a payout, this is just a way to help benefit top of the line companies.
IS THIS WORTH IT FOR TESLA AND SPACEX?
Whether or not this would be a good future decision was talked about by the CAEATFA. They calculated whether or not the added income tax and property out ways the loss in sales taxes. They conclude by saying that the amount of money they spend on their vehicles will reflect the calculation. They also point out that the company needs to notify other smaller companies of this tax incentive program.
