State representatives to reintroduce bills to cut corporate income tax rate

State Reps. Greg Rothman (R-District 87) and Barbara Gleim (R-District 199) announced last week their respective plans to reintroduce bills designed to improve Pennsylvania’s business climate and keep it economically competitive by reducing the state’s Corporate Net Income (CNI) Tax rate.

Currently, Pennsylvania’s CNI Tax rate is the highest single-rate CNI Tax in the country at 9.99 percent. Both bills seek to amend the Tax Reform Code of 1971.

Rothman’s legislation (formerly House Bill 72) would reduce the CNI tax rate to 3.07 percent while Gleim’s legislation (formerly House Bill 2224) would lower the CNI tax rate to 5.99 percent over four years using a phase-down schedule. Gleim previously served as a co-sponsor for House Bill 72.

In their respective memos circulated to members of the House of Representatives, both Rothman and Gleim state that the high rate stifles economic growth and makes the Commonwealth less attractive for business development. The Tax Foundation ranked Pennsylvania 34^th this year in business tax competitiveness overall and 43^rd among the states that levy a corporate net income tax.

The lawmakers noted that reducing the CNI tax would also make Pennsylvania competitive with neighboring states, such as West Virginia, Ohio, and New York, whose CNI tax in 2018 was 6.50 percent.