Mid-State Lawmakers Say Job Creators Have Reason to Celebrate Tax Independence

Bloom, Cutler tax reforms to be signed into law

HARRISBURG – On Thursday, as the nation celebrates 237 years of independence from tyrannical rule, Pennsylvania business owners can join in celebration of independence from two antiquated tax burdens that are currently stunting economic growth and job creation.

The state’s omnibus Tax and Fiscal codes were expected to be approved by the Senate and sent to the governor’s desk today, and included in them are two separate tax reform measures which would provide much-needed relief to businesses responsible for creating 65 percent of Pennsylvania jobs.

The first reform, authored by Rep. Stephen Bloom (R-Cumberland), eliminates the Pennsylvania inheritance tax on assets of family-owned business enterprises being transferred upon death to surviving family members. Bloom’s bill abolishes a tax of up to 12 percent that currently exists on these types of property transfers.

“Ultimately, this was about establishing a level playing field and freeing our family-owned enterprises from job-killing taxes,” said Bloom. “Too often, this tax forces the liquidation of essential business resources or even the entire business in the aftermath of the death of a principal owner. Without these businesses, our local and state economies would be in jeopardy, and it’s long past time to stop crushing them with punitive taxes.”

Relief from Pennsylvania’s corporate loans tax, an archaic law that taxes in-state business loans, was included in the Fiscal Code. Rep. Bryan Cutler (R-Peach Bottom), prime sponsor of the provision, said unfair tax rates on these loans are hindering economic progress.

“Current law gives a tax advantage to out-of-state lenders rather than those investors we have right here in the Commonwealth,” Cutler said. “This legislation encourages a reinvestment in Pennsylvania and allows small businesses to acquire the capital they need to grow and create jobs.”

The corporate loans tax is currently imposed at the rate of 4 mills on resident individuals who earn interest on bonds and on non-resident corporations if their treasurers are located within the state.

Cutler also noted that the tax impacts about 7,000 taxpayers, which are mostly LLCs and other corporations, and cited an example of an individual who may be subject to the tax as an individual who secures bonds to fund building renovations with the intention of reselling, or “flipping,” a building.

For more information about each lawmaker’s legislative priorities, visit RepBloom.com, or RepCutler.com.

Representative Stephen Bloom, 199th District
Representative Bryan Cutler, 100th District
Pennsylvania House of Representatives
Media Contact: Abbey Fosnot
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