Martin Huff had been California’s top tax collector for 16 years when he went head-to-head with a young Gov. Jerry Brown over the way in which international corporations were taxed – and it cost him his job.
Huff, who resigned as executive officer of the state Franchise Tax Board in 1979 rather than be fired for refusing to play political ball, died on Dec. 29 in Oakland. He was 93. A memorial service is scheduled March 18 in Oakland.
Known for his crusty demeanor and his zealous attitude toward collecting personal and corporate income taxes, Huff was particularly vigorous about California’s “unitary” method of taxing international and multistate corporations, requiring them to open their books for calculations on how much of their worldwide income could be subject to state taxation.
Foreign corporations, especially those in Japan and Great Britain, and their governments despised the system, which few other states even attempted to implement, and constantly tried to change it through the language of tax treaties and direct political appeals to governors and legislators.
Huff resisted them all, contending that without the unitary approach, corporations could manipulate their accounting to avoid taxes in high-tax states such as California.
Initially, during his first governorship, Brown defended the system. But after a trip to Japan, he switched positions and blamed Huff for giving him “flaky data” about unitary taxation’s effect.
Huff publicly denied it, in effect calling Brown a liar. And he also had made enemies in the Legislature by suggesting that lawmakers’ coveted “per diem” expense payments should be considered taxable income. Seemingly, however, he was protected from political retaliation by a special law that he could not be fired without a two-thirds Senate vote.
Late in the 1979 legislative session, the conflicts came to a head when an obscure bill was quietly and quickly amended and passed, removing the two-thirds vote requirement for Huff to be fired. It was evident that few legislators were even aware of the bill’s provisions when the votes were tallied.
Brown allowed the bill to become law without his signature and Huff resigned before he could be ousted.
Huff went on to become a consultant in other states and nations on tax policy, serve on the Sacramento Regional Transit Board as it built the city’s light rail system, serve two-plus years as Walnut Creek’s city treasurer and work with numerous civic groups.
After his departure from the Franchise Tax Board, the unitary taxation system, which applied to multistate as well as multinational corporations, underwent numerous revisions to change its complex formulas – including a 2012 ballot measure, Proposition 39.
Huff, a native of Kansas who served in the Merchant Marine during World War II, came to California after the war, earned a degree from the University of California, Berkeley, worked as a certified public accountant, and served as Oakland’s auditor-controller for five years before being named the Franchise Tax Board’s executive officer in 1963.
Huff’s wife, Anne, died in 2011. He is survived by sons Roger and Douglas Huff and daughter Susan Wagner.
The family is planning a memorial on March 18 at 2 p.m. at Piedmont Gardens, 33 Linda Ave., Oakland.