A bill that would exempt Thoroughbred breeding stock from California sales and use taxes has passed both houses of the state legislature and has gone to Gov. Gray Davis for signing.Assemblyman Mike Briggs included the exemption in AB 426, which contains several other agricultural tax exemptions on items like farm equipment and diesel fuel. It is hoped that the Thoroughbred exemption will help keep and attract better bloodlines to California. "These tax cuts will result in more breeding stock coming to California, which will create much-needed jobs. It's a win-win for the state," Briggs said."This puts us on a level playing field with other states," commented California Thoroughbred Breeders Association general manager Doug Burge. "Before, if you brought a nice stallion or mare to California, you would be subject to the use tax. This will encourage buyers to both purchase in California and bring bloodstock purchased elsewhere into the state."John Harris, CTBA legislative committee chair and owner of Harris Farms, added, "Previously, if you bought an in-foal mare for $100,000 you'd have to pay almost $8,000 in sales or use tax if you wanted the resulting foal to be a Cal-bred. This applied to both horses purchased here or shipped here after being purchased in other states. You could board them for a year in Kentucky for free for that. Elimination of the state portion would reduce that to a cost of about $2,500. I think paying the local portion of the sales tax, about 2.5%, is fair."This legislation will result in better bloodlines shipping into California, and will help greatly in syndicating stallions here. The state will benefit from the increased economic activity, and the decrease in sales tax revenue will be more than offset by other revenues generated. Longer term this bill should produce more and better Cal-breds and help field sizes at the tracks."CTBA president Wes Fitzpatrick said that the exemption "will work hand in hand with the intent of the California Incentive Program to encourage agriculture and the breeding of higher quality horses."The bill would take effect as soon as it receives the governor's signature.