A lawmaker whose district includes an aerospace cluster in the Antelope Valley wants to strike down a tax regimen on space launches that was crafted last year by state officials working in collaboration with Hawthorne-based Space Exploration Technologies Corp., or SpaceX, and other rocket launch companies.
The proposal would roll back the recently devised tax rule from state regulators that calls on rocket launch companies to pay a per-mile tax on income generated by lifting payloads into space from a launch pad in California.
Assemblyman Tom Lackey, R-Palmdale, has introduced a bill to eliminate all income taxes on space launches throughout California.
Lackey’s chief of staff Tim Townsend said in an email that his boss sees eliminating taxes on space launches as a way to boost the state’s fledgling rocket launch industry. His Antelope Valley district includes a heavy concentration of aerospace companies near Edwards Air Force Base
“California has long been one of the leading states for aerospace, and if we create the right policies, the space industry could be a huge provider of jobs and economic growth in the future,” Townsend said in the email.
To tax or not to tax?
Many companies would cheer a plan to eliminate taxes on their core business.
SpaceX last week had no comment on Lackey’s bill, which would undo much of the effort the company put in last year to urge adoption of the tax plan. The privately held company – which doesn’t disclose financials and employs about 6,000 overall with the bulk at its headquarters in Hawthorne – has expressed an overriding concern about ensuring consistency and certainty in the way commercial space launches are taxed.
The business of space travel in California has taken off only in the last three years as private rocket launch companies have moved to meet demand for various communications satellites.
The state, meanwhile, has had no clear taxation method spelled out for income generated by launches.
Such income can be substantial, with satellite companies and other firms willing to spend tens of millions of dollars to reserve space on a launch vehicle; launch prices for the full cargo space within SpaceX’s Falcon 9 rocket start at $62 million.
The only functioning launch pad in California right now is at Vandenberg Air Force Base in Santa Barbara County. SpaceX has conducted most of its launches to date from Cape Canaveral in Florida, although it’s made increasing use of Vandenberg lately.
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