"The payments to California from taxing just 12 companies' worker stock grants made up about 9% of the state's entire income tax withholding for the first half of the year, and an even larger share in the third quarter, he calculated. Given the state's forecasted spending of around $232 billion in the 2025-2026 year, the taxes on just these 12 companies' stock payments can pay more than 4% of the state's entire budget."
"Businesses and investors' hype over artificial intelligence has spurred an eye-watering blitz of money into the tech industry, helping all but one of these 12 companies see their stock prices and valuations swell. In his analysis and estimates, Alamo included Nvidia, Apple, Google, Broadcom, Meta, Cisco, Advanced Micro Devices, Applied Materials, Qualcomm, Intel, Intuit and PayPal. Only PayPal's stock has fallen year-to-date, and only Qualcomm is based outside the Bay Area, in San Diego."
Restricted stock units (RSUs) paid to employees at major tech firms now generate roughly $10 billion per year in California income tax withholdings. Tax withholdings on RSU vesting from a dozen companies accounted for about 9% of the state's income tax withholding in the first half of the year and a larger share in the third quarter. Taxes on these payments could cover more than 4% of the state's $232 billion forecasted 2025–2026 spending. Capital gains taxes on related stock sales are expected to add billions more. AI-driven stock gains lifted valuations for nearly all listed firms.
Read at SFGATE
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