Pennsylvania MP Barbara Gleim (R-Cumberland) announced Tuesday that she intended to introduce laws that will lower the state’s corporate tax rate.
In a memo to members of the House of Representatives, Gleim said her law would cut the rate from 9.99 percent to 4.99 percent.
“Pennsylvania’s current CNIT rate, the highest single CNI tax in the country, is stifling economic growth and affecting our competitiveness by preventing businesses from doing well in the Commonwealth. This extremely high tax rate is also particularly burdensome for industries with long or uneven business cycles due to the restrictions Pennsylvania imposes on net operating loss deduction, ”she said in the memo. “My legislation will simply lower the Pennsylvania corporate tax rate from 9.99 percent to 4.99 percent for tax years beginning after December 31, 2021. This change will help Pennsylvania become more competitive with neighboring states such as West Virginia, New York, Ohio and Virginia, which has resulted in increased investment by companies either moving or expanding in the Commonwealth and creating countless job opportunities for our hard-working residents. “
According to the Tax Foundation, an independent not-for-profit tax policy, 44 states levy corporation tax at rates ranging from 2.5 percent in North Carolina to 11.5 percent in New Jersey. Pennsylvania is one of six states with a top tax rate of 9 percent or more, along with Alaska, Illinois, Iowa, Minnesota and New Jersey.
Ten states – Arizona, Colorado, Florida, Kentucky, Mississippi, Missouri, North Carolina, North Dakota, South Carolina, and Utah – have peak rates of or below 5 percent. Four states, Nevada, Ohio, Texas, and Washington, do not tax corporate income taxes; they levy taxes based on gross receipts. Two states, South Dakota and Wyoming, have no corporate or gross income tax.