Gov. Jerry Brown approves property tax exemption for space companies
Gov. Jerry Brown on Tuesday signed into law a 10-year exemption from state taxes for certain property used for space flight operations in California.
Assemblyman Al Muratsuchi (D-Torrance) introduced the bill to help the state retain businesses including Elon Musk’s Hawthorne-based SpaceX, which has booked nearly 50 launches on its rockets.
This new law codifies a Board of Equalization advisory opinion that rocket propulsion systems qualify for the business inventory tax exemption. The exemption does not apply to land.
“I introduced AB 777 to support and grow one of the most exciting new industries in California, commercial space flight,” Muratsuchi said. “Private companies like Space X are building rocket ships and creating thousands of good-paying manufacturing jobs right here in Southern California.”
The property tax exemption through Jan. 1, 2024, he said, “will allow commercial spaceflight companies to continue to invest and grow in our state.”
State officials estimate the exemption will result in a reduction of local property tax revenue of $1 million annually. The kinds of property subject to the exemption include an orbital space facility, space propulsion system, space vehicle, launch vehicle, satellite and space station, as well as fuel used for space flight.
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