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Tax Credits Key to Economic Recovery
In 2010, we need to get the economic recovery moving. The key for California is the housing and construction industry. The housing and construction continues to be the key to a robust recovery in our state and the nation. To the dedication and credit of our Governor, the new $10,000 Homebuyer Tax Credit Proposal in the Governor’s Jobs Initiative will ensure a positive effect of jobs and housing for our citizens and revenues for our state.
The Governor’s proposal builds on the successful 2009 new home tax credit. $100 million would be available for first time buyers to purchase existing homes. The other $100 million will stimulate construction and new homes. Buyers of these new homes would be eligible for the $10,000 tax credit regardless of whether it’s their first home purchase.
In 2009, the new home tax credit worked. Homebuyers moved off the fence with this incentive, with customer traffic increasing as much as 80% in some areas, with the result of home sales increasing over 100% in some areas. With the new home orders placed, home construction began again and that meant JOBS. More than just construction jobs. Wholesale trades, food services, truck transportation, cabinets, appliances, kitchen and bath and other household products, engineering services and increased demand for all materials. Retail centers, from furniture to electronics saw an increase in demand for their products.
The proposal also improves on the 2009 New Home Tax Credit in order to make sure that as many homebuyers as possible use this incentive, the Franchise Tax Board will assess the credits more accurately based on actual home costs.
Housing has led the way out of every recession since World War II. This new Tax Credit will renew and stimulate the economy and bring jobs back for all Californians.
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