CALIFORNIA LEGISLATURE—
2023–2024 REGULAR SESSION
Senate Joint Resolution
No. 14
Introduced by Senator Becker
|
March 04, 2024 |
Relative to taxation.
LEGISLATIVE COUNSEL'S DIGEST
SJR 14, as introduced, Becker.
Deferred compensation.
This measure would urge the Congress of the United States to establish a reasonable cap on deferred compensation.
Digest Key
Fiscal Committee:
NO WHEREAS, In December 2023, the Los Angeles Dodgers baseball team signed a 10-year, $700,000,000 contract with pitcher and hitter Shohei Ohtani; and
WHEREAS, The current contract is structured so that Ohtani will defer $68,000,000 annually, receiving only $2,000,000 per year for 10 years and potentially saving Ohtani over $90,000,000 in state taxes if he were to reside outside of California when the deferred compensation is paid; and
WHEREAS, The current tax system can allow for unlimited deferrals for high-income earners, establishing an unbalanced tax structure and income inequality; and
WHEREAS, There is a 1996 federal law that bars states from taxing retirement income on out-of-state residents when their payments are made in equal periodic amounts over at least 10 years; and
WHEREAS, The absence of a cap on deferred compensation for high-income earners has created further repercussions on the fair distribution of taxes; and
WHEREAS, Potential limits on deferred compensation for high-income earners can establish an equitable tax system for all and maintain potential state revenue; now, therefore, be it
Resolved by the Senate and the Assembly of the State of California, jointly, That the Legislature urges the Congress of the United States to establish a reasonable cap on deferred compensation to rectify this imbalance; and be it further
Resolved, That the Secretary of the Senate transmit copies of this resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.