CapitolBeat by Jason Fox
Inside Track
CalCPA Legislative Summit & CPA Day Recap
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CalCPA ’ s Legislative Summit featured several panels and guest speakers touching on a wide array of issues . Assemblywoman Jaqui Irwin , who represents the 42nd Assembly District covering parts of Los Angeles and Ventura counties , spoke about her perspective as an established legislator building relationships with newly elected colleagues , balancing an uncertain economy with state budget priorities and her influential role as chair of the Assembly Revenue and Taxation Committee .
Newly elected Senator Roger Niello CPA ( inactive ), who represents the 6th Senate District covering parts of Sacramento and Placer counties , spoke about how his experience as a CPA has helped inform his career in public policy , how things have changed since his previous legislative service in the early 2000s and what role he sees for CPAs to help address some of the challenges facing California .
Katrina Salazar , president of the California Board of Accountancy and board member of the National Association of State Boards of Accountancy , discussed efforts to address pipeline pressures , refinements to the licensure framework , what regulators are looking at to support consumer protection efforts and efforts to coordinate with the profession to tackle challenges .
CalCPA members also heard from government relations insiders regarding how the CPA profession can best navigate the shifting political and policy landscape .
With the added context and perspective , CalCPA members took advantage of the opportunity to get back to in-person meetings with members of the Legislature to reconnect and build new relationships with many of the newly elected officials .
Added Flexibility & Refinement of Pass- Through Entity Tax ( PTET ) Provisions While the PTET has provided significant relief for many taxpayers , CalCPA members with real-world PTET experience have identified issues that limit accessibility to the PTET and complicate its implementation . CalCPA members urged consideration of recommendations we believe will ensure the PTET is sufficiently accessible and beneficial to all taxpayers it ’ s intended to assist . Specifically , the rigid June 15 deadline that complicates election into PTET and a reevaluation of the non-refundability of the PTET credits .
CalCPA Can Help Advance Financial Literacy The economic uncertainty of the last few years has exposed a glaring need for improved financial literacy education . While progress has been made , CalCPA members are ready to work with policy leaders to build on the momentum and advance financial literacy policies that help Californians avoid preventable financial pitfalls that stem from insufficient knowledge of basic personal finances .
CPA Profession Background With more than 30 new legislators , it ’ s critical to make sure they understand the basics of what it takes to become a CPA , how CPAs serve the public , the history of CalCPA , and the efforts of member leaders to support the CPA profession and the public . Additionally , for added context , members outlined the issues the profession is talking about , including an increasingly challenging business climate ; efforts to bolster the CPA pipeline to meet consumer demand ; and fostering a more diverse , equitable and inclusive CPA profession .
You can find more about these efforts and CalCPA ’ s grassroots advocacy efforts at calcpa . org / CPAday .
Legislation Back Again The Legislature is in the process of introducing and vetting legislative proposals . In the mix are some reintroductions of proposals that surfaced last year , but failed to get traction .
AB 259 / ACA 3 would establish a wealth tax that would add a tax on the state ’ s wealthiest residents of 1 percent of their worldwide net worth over $ 50 million . It would also impose an additional 0.5 percent tax on wealth over $ 1 billion . The wealth tax would be on top of income taxes , and would apply to a person ’ s total assets , not just income earned . Supporters say they would use the money to fund schools , infrastructure and other public services .
The complex new tax framework did not get traction last year and would have a long and challenging path this year . Regardless of the political reality of the proposal , it is likely to get some attention from policy leaders as they consider plans to navigate a potential budget shortfall .
SB 253 would establish the Climate Corporate Data Accountability Act to require businesses to report certain data related to greenhouse gas emissions . A similar bill nearly passed out of the Legislature last year , but stalled in the Assembly . ESG reporting and how it fits with financial data has been a growing practice area for CPA firms . CalCPA continues to work with stakeholders on this issue to ensure CPAs are well positioned to assist business with any new reporting obligations that may emerge .
Legislation to exempt forgiven student loans from state tax obligations has also emerged . Several legislative leaders have indicated that they will pursue legislation to address this issue once the federal policy of how and to what extent loans can be forgiven is settled .
Stay tuned for much more as legislative proposals continue to take shape .
Jason Fox is CalCPA ’ s vice president of government relations . You can reach him at jason . fox @ calcpa . org .
18 CALIFORNIA CPA MARCH / APRIL 2023 www . calcpa . org