California's plan to tax spaceflight

The California Franchise Tax Board is seeking public comment on it's proposal for computing taxes on commercial space transportation companies.

While the private spaceflight industry is still in its infancy, it has grand plans for the future. The people at the tax board say they're ready to handle the space business once it really takes off.

The rules apply to any California company that generates at least half of the money it takes in from "space transportation."

"Space transportation" is defined as "the movement of people or property 62 miles above the surface of the Earth."

62 miles above the surface of the Earth is recognized around the world as the line that separates Earth from space.

The tax rules would apply to companies that use California as a launchpad, not to California companies launching out of Texas or Florida.

Thomas Lo Grossman, a tax attorney at the Franchise Tax Board, says the proposed rules mirror the way taxes are levied on trucking or train companies in California.

So if Texas and Florida don't levy taxes on space flight, will California lose the new space race?

Space, the final tax frontier.

Read more at the SF Chronicle.

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