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Tesla Gets $34 Million Tax Break, Adds Capacity For 35,000 More Cars
cartechboy writes "The state of California will give Tesla Motors a $34.7 million tax break to expand the company's production capacity for electric cars, state officials announced yesterday. Basically, Tesla won't have to pay sales taxes on new manufacturing equipment worth up to $415 million. The added equipment will help Tesla more than double the number of Model S sedans it builds, as well as assemble more electric powertrains for other car makers. In addition to continued Model S production, Tesla plans to introduce the Model X electric crossover in late 2014, as well as a sub-$40,000 car — tentatively called Model E — that could debut as soon as the 2015 Detroit Auto Show. It turns out California is one of the few states to tax the purchase of manufacturing equipment — but the state grants exemptions for 'clean-tech' companies."
The rest of us are grateful for your generous contributions to our new luxury cars.
The cow says "Moo." The dog says "Woof." The Timothy says "Thanks, valued customer. We appreciate your input."
Unless you value your environment nothing, why shouldn't there be a financial reward for companies that reduce the harm on it, either directly or indirectly?
Big corporations are evil because they don't pay their taxes unless it's our pet company in which case it's all wine and roses.
Another business that can't survive without tax payer money to help keep the costs down on a vehicle that only wealthy folks can afford. Brilliant.
There are no loopholes. It's either legal or it's not.
Surprised no one posted that Tesla will have Models identified as S, E and X when these are all rolled out.
With a value-added tax (VAT), if you buy $150 of intermediary stuff, and use it to produce $200 of stuff, the tax is levied on $200 in total value, which is charged as $150 on the first sale and $50 to the second sale. If you buy equipment that is producing goods or more equipment, you only pay sales tax on the incremental value added, not on the cost of the machinery.
With a sales tax, you either charge on both sales for the full amount, in which case a $200 product has paid sales tax on $350 worth of sales in this example, or you do special-case exemptions, such as exempting "manufacturing equipment" from sales tax entirely, as some states do. Sales taxes are also more brittle because since the entire tax on charged on the final retail transaction, it encourages black-market no-sales-tax sales.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
"Luxury" funds early adoption of tech when it's expensive. The cost drops later. At one time all automobiles were luxury purchases.
A computer user above all should understand how that works.
Customers whose purchases make high performance video cards profitable to develop come to mind as examples.
"This post is an artistic work of fiction and falsehood. Only a fool would take anything posted here as fact."