California Puts Tax Fairness at Risk in Undoing Microsoft Refund

California lawmakers protecting the state from having to issue more than $1 billion in tax refunds to multinational corporations are undermining the state’s independent tax appeals tribunal and fairness of its tax system in the process, tax practitioners said.

The move to undo a recent ruling from the Office of Tax Appeals granting Microsoft Corp. a $94 million income tax refund—contained in a bill (S.B. 167) that lawmakers passed on Thursday as part of the state budget—is meant to foreclose the possibility that many other multinationals can win similar refunds. Gov. Gavin Newsom (D) asked for the measure and ...