Business tax reforms hailed
As part of his budget plan, Gov. Tom Corbett proposed business tax reforms the business community welcomed.
Corbett billed the reforms as “broad-based” and focused on cutting business “tax burdens that inhibit job creation and economic growth.” The Department of Revenue estimated the measures would spur at least 18,000 jobs in the next 10 years and grow the state's economy enough to raise an additional $1 billion in business tax revenue by 2030.
• Reduction of the corporate net income tax to 6.99 percent from the current 9.99 percent by 2025. Pennsylvania's corporate net income tax rate is the nation's second-highest, behind only Iowa, whose 12 percent rate applies only to companies with at least $250,000 in profit.
• Raising the cap on net operating losses companies can deduct from their taxable income to $5 million, or 30 percent of income, whichever is greater. The state caps the deduction at $3 million, or 20 percent of income. New Hampshire is the only other state to impose a cap on deductible losses.
• Eliminating the capital stock and franchise tax in January 2014. The levy taxes both company assets and income. Pennsylvania is the only state to impose both a capital stock and franchise tax and a corporate net income tax.
“Clearly, reducing the corporate net income tax and uncapping the net operating losses will make Pennsylvania more attractive to business,” said Kevin Shivers, executive director of the Pennsylvania chapter of the National Federation of Independent Business, Harrisburg.
Opponents of the capital stock and franchise tax first targeted it for elimination in 1999 and, “We're finally going to eliminate it under the governor's plan,” said Shivers.
Brian Kennedy, vice president of government relations for the Pittsburgh Technology Council, said raising the cap on deductible losses particularly would help the kind of early-stage companies his South Oakland group represents because most young companies lose money their first few years.
“This has been a top priority of ours for many years,” Kennedy said. “This proposal starts to bring (Pennsylvania) into the competitive middle of the pack of states.”
Thomas Olson is a staff writer for Trib Total Media. He can be reached a 412-320-7854 or at firstname.lastname@example.org.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Consol, Noble expect at least $325 million from partnership’s IPO
- Douglas Laboratories sells Klean Athlete: products free from banned substances
- UPMC buying New Castle-based Jameson Health System
- FedEx to add 50,000 seasonal jobs
- Mylan CEO Bresch sets sights on growth
- Casing cracks, not fracking, blamed for gas in water wells
- U.S. Steel to restructure Canadian subsidiary, halt 2 U.S. expansion projects
- Tobacco growers forced to find profits as buyout checks end in October
- 2 top executives at Dick’s Sporting Goods to retire
- Congress: Safety agency mishandled GM recall
- American Airlines agents vote to join union