TribLIVE

| News

 
Larger text Larger text Smaller text Smaller text | Order Photo Reprints

Tax package gets rare bipartisan support in Harrisburg

Email Newsletters

Click here to sign up for one of our email newsletters.

Daily Photo Galleries

'American Coyotes' Series

Traveling by Jeep, boat and foot, Tribune-Review investigative reporter Carl Prine and photojournalist Justin Merriman covered nearly 2,000 miles over two months along the border with Mexico to report on coyotes — the human traffickers who bring illegal immigrants into the United States. Most are Americans working for money and/or drugs. This series reports how their operations have a major impact on life for residents and the environment along the border — and beyond.

Wednesday, Jan. 25, 2012
 

HARRISBURG — Efforts to close a corporate tax loophole received a major boost today when House GOP leaders joined Democratic lawmakers to urge its passage.

Closing the so-called Delaware loophole is an issue that has languished at least seven years. Former Democratic Gov. Ed Rendell never could persuade legislators to pass it.

But combining the measure with corporate tax cuts GOP lawmakers seek produced an unusual bipartisan group of 21 Democrats and Republicans, who called for both ideas to be part of this year's budget negotiations.

Now, multi-state corporations can legally reduce their Pennsylvania tax liability by transferring ownership of certain assets to an affiliated company in Delaware.

The new proposal targets companies taking advantage of the loophole solely for Pennsylvania tax avoidance, lawmakers said. Certain expenses would be required to be added back for tax purposes.

The first year, the measure would generate just $30 to $40 million in additional state revenue, said House Majority Policy Chairman David Reed, R-Indiana. He teamed with Democratic Rep. Eugene DePasquale, of York, for an overall tax fairness package introduced today.

In subsequent years, the added revenue could be hundreds of millions of dollars a year, Reed indicated. Revenue brought in under the proposal would go toward tax reductions for business.

The plan calls for reducing the state's Corporate Net Income Tax from 9.99 percent to 6.99 percent over six years.

Pennsylvania's CNI tax rate is second-highest in the nation.

House Speaker Sam Smith, R-Punxsutawney, and Majority Leader Mike Turzai, R-Bradford Woods, attended the news conference today to discuss the measures.

Rendell "wanted to take a sledgehammer" to the loophole, Turzai said, but the proposal offered today takes a "laser-like" approach to fixing the problem.

Subscribe today! Click here for our subscription offers.

 

 

 


Show commenting policy

Most-Read News