Pennsylvania Considers Lowering Business Tax

A business tax reform commission is recommending lowering the state's corporate net income tax from 10 percent to as low as 6 percent.

If Pennsylvania lowers its corporate net income tax, it will be a significant selling point for Pennsylvania as a place where executives want to relocate their businesses, said Secretary of Revenue Gregory Fajt, the commission's chairman.

To replace the lost revenue, the commission said the state would have to close loopholes in the corporate net income tax and eliminate some tax credits and economic development programs that may not be necessary as a result of a lower tax.

The proposal is nothing more than "tax shifting," said Jim Welty, a lobbyist for the Pennsylvania Chamber of Business and Industry.

He said that the commission could recommend overall lower taxes if it takes into account the resulting increases in personal income that business creation would cause.

A final report will be produced later this year.

Gov. Ed Rendell created the commission in an effort to lure more businesses and create a fairer tax code.

More here.