HARRISBURG, Pa., Feb. 5, 2013 /PRNewswire-USNewswire/ -- Gov. Tom Corbett today introduced a jobs-focused budget proposal that continues to make state government a true partner in job creation.
Through broad-based tax reform, building a trained and skilled workforce, and deploying strategic solutions to foster a strong business climate, the governor's proposal positions Pennsylvania well for continued job growth.
The governor's budget includes a bold tax reform proposal that focuses on improving Pennsylvania's tax climate by reducing tax burdens that inhibit job creation and economic growth. Specific initiatives include the following:
- Eliminating the capital stock/foreign franchise tax in January 2014, putting an end to Pennsylvania's role as the only state in the nation to tax both business income and business assets.
- Beginning to reduce the corporate net income tax from one of the highest rates in the nation at 9.99 percent down to 6.99 percent through a gradual, multi-year phase-down.
- Raising the cap on net operating loss deductions from $3 million, or 20 percent of income, to $5 million, or 30 percent of income, to attract technology, bioscience and research companies.
- Allowing for like-kind exchanges and start-up business deductions, aligning state tax code with federal tax treatment and encouraging small business expansion.
- Repealing the corporate loans tax , ending an unjust burden placed on small businesses without access to traditional forms of lending that take loans to grow or simply pay regular business expenses. Elimination of this tax will also end a deterrent to establishing corporate headquarters in Pennsylvania.
- Simplifying the tax code and repealing nuisance taxes , eliminating a number of anti-job growth restrictions on business and individuals and removing obsolete taxation and administrative provisions.
Combined, these tax reform measures are projected to have a significant positive impact on Pennsylvania's economy."Economic modeling shows that these initiatives will create more than 18,000 jobs over the next 10 years, as well as increase the state gross domestic product by $2.8 billion and grow personal income by $1.9 billion by 2030," Department of Revenue Secretary Dan Meuser said. "These positive economic effects also increase state tax revenue, creating more than $1 billion in new tax revenue through 2030." The governor's proposed budget for the Department of Community and Economic Development (DCED) places an emphasis on public/private partnerships, international business development, and deploying state resources to support private sector job creation and business growth.