HARRISBURG – State Rep. Tommy Sankey (R-Clearfield) joined the majority of his House colleagues Monday in passing House Bill 440, which would improve Pennsylvania’s business climate by reducing the state’s Corporate Net Income (CNI) Tax. The bill, which now sits with the state Senate, would make the Commonwealth more inviting to potential job creators.
“We can say the economy appears to be improving, but things will never truly get better until we seriously address unemployment and the elements that impact job creation,” Sankey said. “Making Pennsylvania more inviting to outside employers needs to happen, and this bill will do that.”
House Bill 440 would reduce to 6.99 percent Pennsylvania’s current CNI Tax of 9.99 percent, which is the highest flat rate in the country and the second highest overall. Many companies seek to avoid the high tax by creating a shell company in a tax-haven state like Delaware, thereby taking advantage of what is referred to as the “Delaware loophole.”
“To some, the answer to revenue shortfalls is more taxes,” added Sankey. “The Delaware loophole is the epitome of tax policy that literally chases away revenue for the state, and maybe the biggest reason why Pennsylvania places the highest tax burden on corporations in the country, and is considered to have one of the worst business climates in the country.”
More than 70 percent of Pennsylvania companies subject to the CNI Tax pay no tax. The reduction would take place over a period of 10 years, beginning in 2015.
Questions about this or any other legislative topic may be directed to Sankey via email at Tsankey@pahousegop.com or through his Facebook page at www.Facebook.com/RepSankey.