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California mulls tax breaks to keep commercial space firms from leaving

SpaceX Falcon test
SpaceX Falcon test

In a belated move to keep more commercial space business in California, that state is contemplating granting tax breaks to firms such as SpaceX to keep them in the Golden State according to a January 29, 2014 story in Reuters.

“For-profit space explorers who make California their headquarters would not have to pay property taxes on their rockets and space stations under a bill that advanced in the state legislature on Wednesday.

“The move is aimed at stopping an effort by Los Angeles County to collect levies on equipment owned by the privately held SpaceX in Hawthorne, California. It is part of a broader effort by lawmakers to revitalize California's flagging aerospace sector, once among the nation's largest and key to the state's economy.”

The aerospace industry in California has been hit particularly hard by Obama administration defense and NASA cutbacks. Other states, such as Texas and Florida, have been offering generous tax breaks and other enticements for commercial space firms to move and establish infrastructure. XCOR, a company planning to take the well heeled and adventurous on suborbital jaunts, has already started to move to Midland, Texas.

California has been a high tax, high regulatory state for the past couple of decades, the result being an exodus of industry and people from the state. The bill in question seems to be an attempt to keep aerospace from following through a targeted tax incentive.