Facebook IPO would give California a revenue boost: analyst

A Facebook IPO would have a significant impact on California’s revenue, the state’s nonpartisan legislative analyst said yesterday. If it occurs, the Legislative Analyst’s Office estimates the social-networking company would issue $10 billion worth of stock, and California taxes the capital gains from stock sales, the Associated Press reported.

"In the coming months, the state's revenue forecast will need to be adjusted somewhat to account for the possibility of hundreds of millions of dollars of additional revenues related to the Facebook IPO," California's legislative analyst Mac Taylor wrote in an analysis of Gov. Jerry Brown's budget proposal, released Wednesday, according to the AP.

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Google Inc.’s $1.67 billion IPO in August 2004 gave California a boost, Bloomberg News reported.

According to Bloomberg News:

Capital-gains earnings in the state jumped 49 percent the year after that offering. Within two years, taxes on those earnings accounted for 11 percent of the budget, up from 8 percent, according to Finance Department figures.

Taylor noted that a Facebook offering could be four times the size of Google’s IPO, the AP reported.

Gov. Jerry Brown’s proposed budget currently anticipates that California income earners will have $96 billion in capital gains in 2012, and the state will collect $8.6 billion in taxes on those capital gains, accounting for about 9 percent of general fund revenue, Bloomberg News reported.

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