(HARRISBURG) – To attract new employers and promote economic growth in the Commonwealth, Senator Ryan Aument (R-36) announced his intent to introduce legislation that would gradually reduce the state’s corporate net income (CNI) tax rate using a performance-based mechanism.
The proposal would incrementally reduce the CNI tax from its current rate of 9.99% to 6.99% by 2024. The rate could then be further reduced only if it meets or exceeds the revenue projections for 2024 at the 9.99% rate.
This performance-based mechanism is unique from other proposals because it only reduces the CNI tax to its lowest rate if the economic success of lowering it can be shown through revenue projections. In other words, the benefits must equal or outweigh the costs of cutting the tax, or else the tax will not be further cut.
In addition to helping the Commonwealth compete for new businesses and the jobs they create, the CNI tax rate reduction would provide more opportunities for residents to experience earned success and upward economic mobility.
“As the 2020 Census data demonstrated, Pennsylvania’s population growth has been nearly stagnant. Many of us have seen it in action as children grow up and get jobs in other states where there’s greater economic opportunity. It has resulted in the state’s loss of a congressional seat,” Aument said. “We must take action to counter this population trend, incentivize working professionals and families to move here and stay here, and create economic opportunity for our residents – the first step to achieving those goals is to make the state’s CNI tax rate competitive with that of neighboring states.”
Lowering the CNI tax rate would make Pennsylvania attractive to businesses and families when compared to other states. New York’s and West Virginia’s CNI is 6.5%, and Virginia’s CNI is 6%. Currently, only New Jersey has a higher rate than Pennsylvania.
CONTACT: Stephanie Applegate, 717-787-4420