Small Businesses Haunted by New Taxes and Mandates

Tom Scott
CA Executive Director, National Federation of Independent Business

As many Californians prepare for a night full of fright this Halloween evening, small business owners have much more to fear than spooky costumes and decorations. Our final The Good, The Bad, & The Ugly update of the year illustrates some of the most severe taxes and mandates which are sure to haunt small businesses and working families in the new year. This list identifies legislation which will have the greatest impact, either negative or positive, to the 3.8 million small businesses across California

Unfortunately, not all of these new burdens can wait until January 1 to kick in. At midnight tonight, after a day full of spooky Halloween festivities, Sacramento is sending all Californians the ultimate trick: a 12-cent gas tax increase.

We know this destructive gas tax will disproportionately hurt working families and struggling small businesses, but unfortunately the list of new burdens does not stop there. Governor Brown signed a slew of additional bills which will make California even more hostile to small business.

AB 168 (Eggman): Employee Wages: Prohibits employers from asking applicants about their salary history, and requires them to provide a pay scale upon request. It effectively eliminates an employer’s ability to negotiate wages, and creates a new reason to sue, despite the fact that it is already illegal to base someone’s pay on their salary history.

AB 450 (Chiu): Immigration Worksite Enforcement Actions: Unfairly punishes employers for cooperating with federal immigration agents. This bill forces them into a no-win situation by imposing steep fines for allowing access to the worksite to federal agents without a warrant. It will only serve to paint a target on employers, while creating new legal liabilities and huge penalties.

AB 1008 (McCarty): Ban the Box: Prohibits employers from asking applicants about convictions until they make a conditional offer of employment. It creates new obligations and liabilities for employers and allows for new lawsuits. It will hamstring a small business owner’s ability to quickly fill a position by creating a mandatory delay for applicants to respond to net getting a job offer

SB 63 (Jackson): Family Leave: Requires employers with as few as 20 employees within a 75-mile radius to provide 12 weeks of parental bonding leave, in addition to the other leaves of absence California already imposes, including maternity leave. A new mother would be eligible for seven months of protected leave. It creates new legal liabilities for employers. The 20- employee requirement applies to employers who may have several small businesses with fewer employees within a 75-mile radius.

Take a moment to review the full list of new taxes, mandates, and regulations small businesses are facing in the new year.

Currently, the list includes 58 bills total (17 good; 12 bad; and 29 ugly). By the end of the 2017 half of the 17-18 legislative session, Governor Brown acted on 17 (30%) of the bills on our list.

Governor Brown signed 2 (100%) Good Bills; 1 (50%) Bad Billl; and 11 (85%) Ugly Bills.

Governor Brown vetoed 0 Good Bills; 1 Bad Bill (50%); and 2 (15%) Ugly Bills.

This list reflects proposals from the 2017-2018 legislative session, and as new bills are introduced or morphed into substantively new bills, this list will be updated. You can always find the current version at http://www.nfib.com/ca/gbu

Tom Scott is the State Executive Director for NFIB California, which represents 22,000 dues-paying small business members across the state.

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