Reviews of Gov. Tom Corbett’s sweeping budget proposals are pouring in, and as far as the business sector is concerned, the notices are mostly positive.
Corbett proposed cutting business taxes over time and upping some deductions for losses as a prescription for moving Pennsylvania’s economy forward. David Black, president & CEO of the Harrisburg Regional Chamber and Capital Region Economic Development Corp., called it the right medicine for a still-recovering state economy.
“It was overall probably the Governor’s best budget address and message so far, and best overall proposal,” Black said “It’s important to remember we are still in extremely challenging economic times with huge pension obligations absorbing a huge amount of annual state revenue. All of his tax initiatives will be well received by the business community.”
Specifically, Black cited final phase out of the Capital Stock and Franchise Tax in 2014 and a long range plan to lower the corporate net income tax from the current rate of 9.99 percent down to 6.99 percent by 2025. Black said he expected the rate reductions to come with changes in exemptions and deductions for corporations, as well. But when the dust settles, Black said reducing the corporate tax could remove one of the single-biggest barriers to attracting new employers to Pennsylvania.
“That rate is a serious perception problem for Pennsylvania as well as a real problem for Pennsylvania corporations,” Black said. “We need to see more detail, but we like the sounds of a proposed deduction for business start-up costs and tax simplification is always appreciated.”
Black also had praise for Corbett’s plans for streamlining economic development and job-training efforts, making them more focused on employers.
“From an economic development program perspective we really like the PA Business Development Authority, an idea that is long overdue and from a Harrisburg Region standpoint,” said Black. He added that another point of economic emphasis would be preserving the state’s military installations, a major source of jobs.
Finally, Black credited Corbett with moving Pennsylvania in the right direction when it comes to transportation — both in terms of bureaucratic reform and cost-savings, as well as infrastructure investment.
“Transportation for commerce and public safety are too important to be ignored,” Black said. “The Harrisburg Region is largely built on our transportation infrastructure. Few can argue the responsibility for government to maintain infrastructure.”
But Black indicated that there’s plenty of money to be saved, too.
“We will be hearing more about cost cutting at PennDOT and the Turnpike Commission, the elimination of outdated, redundant and expensive processes of procurement, use of technology in car registrations to save money … while removing the outdated cap on the Oil Franchise tax,” he said.