State taxation of multistate and multinational corporations is not an issue for the fainthearted.
The formulas for calculating their tax liabilities are complex and interpreting them has involved decades of political and legal wrangling, fueled by the issue’s multibillion-dollar stakes.
The issue bugged Jerry Brown during his first governorship four decades ago and as his second governorship winds down, it’s still percolating.
Just before Brown was elected governor in 1974, the state joined a multistate compact to bring uniformity to corporate taxation, its major feature being the use of three equal factors – payroll, property and sales – to calculate what portion of corporate income should be attributed to each state.
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