Rapp: Abolish 'Capital Punishment'
to Spur Job Creation in the State
Eight days before the governor’s annual budget address, State Representative Kathy Rapp (R-Warren/Forest/McKean) joined with State Representative Daryl Metcalfe (R-Butler) and more than a dozen other fiscally conservative House Republicans in the state Capitol Rotunda on Tuesday to offer several government-limiting solutions that are designed to put Pennsylvania Taxpayers First.
Citing Pennsylvania’s near-bottom-of-the –barrel national rankings in job growth, personal income growth, and population growth, Rapp called for the immediate “abolishment” for some of the Keystone State’s highest business tax rates or “capital punishments” to spur job creation.
“In short, increasing business taxes or regulatory fees to pay for fiscally-irresponsible General Fund spending and borrowing is a formula for government-assisted, economic suicide,” said Rapp. “The simple fact remains that whenever businesses are paying more money on taxes, mandatory employee training and unnecessary legal or regulatory compliance costs, the unfortunate result is a loss of jobs, and even more impoverished families as employers of all shapes and sizes are forced to reduce to the bare bones to survive.”
Specific business tax reductions suggested by Rapp included:
Completing the phase-out of the Capital Stock and Franchise Tax.
Reducing Pennsylvania’s 9.99 percent Corporate Net Income Tax (CNI) to 6.9 percent.
Amending the CNI to implement a Singles Sales Factor on business profits only, rather than the current system that also taxes property and employee payrolls.
Removing the $2 million cap on Net Operating Loss (NOL) deductions that businesses are allowed to carry forward into the next fiscal year.
“The business-friendly policy suggestions outlined here represent only a fraction of the options available to state lawmakers to improve Pennsylvania’s overall economic climate,” said Rapp. “Competitive tax rates and tax credits, flexible regulations, permitting processes and land approvals, and infrastructure support are some of the many other influences or ingredients that attract or deter expansion or the relocation of businesses. As the reign for one of the most notorious tax-and-spend, anti-business governors in the history of the Commonwealth draws to a close, these same integral growth-producing elements are rapidly becoming endangered economic species teetering on the brink of extinction.”
Other Taxpayers First protections outlined at Tuesday’s press conference and supported by Rapp include:
Implementing constitutional or statutory spending limits.
Reducing the state Personal Income Tax to the pre-Rendell level of 2.8 percent.
Eliminating all state discretionary funding or “Walking Around Money” (WAMs).
Repealing Pennsylvania’s prevailing wage mandate and tolling of Interstate 80 (Act 44 of 2007).
Reducing total state welfare spending by 10 percent and transferring the roughly $1 billion in savings to fund core bridge and highway construction projects.
Requiring any future local school and municipal tax increases to be approved through a voter referendum.
Finally, enacting a 2009-2010 state budget that contains no new taxes, no new spending and no new borrowing.
“As companies continue to take their business and jobs elsewhere at an alarming rate, the information provided during today’s press conference should serve as a long-overdue wakeup call for all anti-business lawmakers who continue to hit the snooze button on statewide economic development,” said Rapp. “Much more can and must be done immediately. Our state’s job creators are not operating in a vacuum and more competitive states will simply not wait for Pennsylvania to catch up.”
Citing Pennsylvania’s near-bottom-of-the –barrel national rankings in job growth, personal income growth, and population growth, Rapp called for the immediate “abolishment” for some of the Keystone State’s highest business tax rates or “capital punishments” to spur job creation.
“In short, increasing business taxes or regulatory fees to pay for fiscally-irresponsible General Fund spending and borrowing is a formula for government-assisted, economic suicide,” said Rapp. “The simple fact remains that whenever businesses are paying more money on taxes, mandatory employee training and unnecessary legal or regulatory compliance costs, the unfortunate result is a loss of jobs, and even more impoverished families as employers of all shapes and sizes are forced to reduce to the bare bones to survive.”
Specific business tax reductions suggested by Rapp included:
Completing the phase-out of the Capital Stock and Franchise Tax.
Reducing Pennsylvania’s 9.99 percent Corporate Net Income Tax (CNI) to 6.9 percent.
Amending the CNI to implement a Singles Sales Factor on business profits only, rather than the current system that also taxes property and employee payrolls.
Removing the $2 million cap on Net Operating Loss (NOL) deductions that businesses are allowed to carry forward into the next fiscal year.
“The business-friendly policy suggestions outlined here represent only a fraction of the options available to state lawmakers to improve Pennsylvania’s overall economic climate,” said Rapp. “Competitive tax rates and tax credits, flexible regulations, permitting processes and land approvals, and infrastructure support are some of the many other influences or ingredients that attract or deter expansion or the relocation of businesses. As the reign for one of the most notorious tax-and-spend, anti-business governors in the history of the Commonwealth draws to a close, these same integral growth-producing elements are rapidly becoming endangered economic species teetering on the brink of extinction.”
Other Taxpayers First protections outlined at Tuesday’s press conference and supported by Rapp include:
Implementing constitutional or statutory spending limits.
Reducing the state Personal Income Tax to the pre-Rendell level of 2.8 percent.
Eliminating all state discretionary funding or “Walking Around Money” (WAMs).
Repealing Pennsylvania’s prevailing wage mandate and tolling of Interstate 80 (Act 44 of 2007).
Reducing total state welfare spending by 10 percent and transferring the roughly $1 billion in savings to fund core bridge and highway construction projects.
Requiring any future local school and municipal tax increases to be approved through a voter referendum.
Finally, enacting a 2009-2010 state budget that contains no new taxes, no new spending and no new borrowing.
“As companies continue to take their business and jobs elsewhere at an alarming rate, the information provided during today’s press conference should serve as a long-overdue wakeup call for all anti-business lawmakers who continue to hit the snooze button on statewide economic development,” said Rapp. “Much more can and must be done immediately. Our state’s job creators are not operating in a vacuum and more competitive states will simply not wait for Pennsylvania to catch up.”
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