Pennsylvania state Rep. Robert Mercuri (R-Pine) said Tuesday that he plans to introduce legislation that would reform Pennsylvania’s tax laws.
In a memo to Pennsylvania House members, Mercuri said he wanted to bring the state’s tax laws more in line with the federal government’s and to create tax policy that was more favorable with existing and prospective businesses.
“We are all familiar with calls to reform Pennsylvania’s current 9.99% CNIT rate, the highest flat tax rate in the country, and given the sticker shock of this rate as well as testimony of the competitive disadvantage it represents, such calls need to be made and heard,” he wrote. “But what cannot be forgotten is the host of other complexities and challenges that businesses face while navigating Pennsylvania’s tax laws.”
According to a study by WalletHub in 2021, Pennsylvania ranks in the top five states in the country for the highest tax rates. The state joins Kansas, New York, Connecticut and Illinois as having the highest taxes, based on an analysis of real estate tax, income tax, sales and excise tax and vehicle property tax.
Mercuri said it was important that the legislature take action to change tax policy now to help businesses recover from the economic downturn that was a result of the COVID-19 pandemic, and to attract new businesses to the state.
“In recent legislative sessions, an emphasis has been placed on achieving simplicity by conforming with Federal tax laws where it is appropriate and advantageous to do so,” he wrote. “This has led to the consideration of countless pieces of legislation, amending nearly every article of the Tax Reform Code of 1971, for the benefit of our constituencies. My legislation builds upon these efforts by proposing further changes relating to the depreciation of assets owned by businesses and the determination of basis for property that is sold or otherwise disposed of during a taxable year.”