Facebook Goes Public and the Big Winners are…California Taxpayers
Tuesday, May 22, 2012
Facebook goes public (photo: Zef Nikolla, AP)
News of Facebook’s initial public offering couldn’t have come at a better time for California Governor Jerry Brown.
Confronted with a budget deficit of nearly $16 billion, Brown and the state’s lawmakers have been looking for new sources of revenue. It turns out that Facebook’s IPO may be just that.
According to the California Legislative Analyst’s Office, the trading of shares of Facebook, which is based in Menlo Park, may generate as much as $2.1 billion in tax revenues through the end of the next fiscal year.
It is estimated the state could receive about $500 million by June 30 and another $1.6 billion by the end of June 2013.
Tax revenues in the Silicon Valley, where Facebook is headquartered, may also get a boost from the IPO. Realtors expect plenty of new home buys in Menlo Park and other nearby communities as shareholders of the social media giant use some their newfound wealth to buy property.
To Learn More:
Summary of LAO Findings and Recommendations on the 2012-13 Budget (Legislative Analyst’s Office)
Facebook IPO: Will It Boost Silicon Valley Real Estate Prices? (by Susanna Kim, ABC News)
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