Another one bites the dust, or moves out of state!

Sacramento CA

Description

Smithfield Foods to shutter California meat-packing plant! Meat-packing giant Smithfield Foods said Friday it will close its only California plant next year, citing the escalating cost of doing business in the state. The Farmer John meat-packing plant in Vernon, an industrial suburb south of Los Angeles, will shut down in February, with its 1,800 employees receiving severance and job placement support along with bonuses for those who choose to stay on the job until the closure, said Jim Monroe, vice president of corporate affairs. Some workers, who on average earn about $21 per hour, also will have opportunities to relocate to other facilities owned by the Virginia-based Smithfield Foods Inc. Not surprisingly, California businesses tend to relocate from the counties with the highest taxes, highest regulatory burdens, and most expensive real estate, such as San Francisco, and they tend to relocate to states where it is easier to prosper. Texas imposes just a 0.75% franchise tax on business margins, compared to California’s 8.85% corporate tax. As if this large difference weren’t enough of an incentive to leave, the city of San Francisco imposes a 0.38% payroll tax, and a 0.6% gross-receipts tax on financial service companies. Yes, if your business is in San Francisco, not only are your profits taxed by the state, but your payroll and your output are taxed as well. Not to mention that Texas has no individual income tax, compared to California’s current top rate of 13.3%, which may rise to 16.3% soon, and which would apply retroactively. California may lose up to $1 billion a year just from individual income tax. Plus another $12 billion in business taxes. Add to that the loss of a congressional seat begs the question, how well are your elected representatives doing their jobs?