The Tax Foundation provided an updated analysis of how pro-growth tax reforms, recently enacted in Pennsylvania, will improve the state’s ranking among states. Per their analysis, Pennsylvania currently ranks 44th in corporate tax structure among states, but will leap to 27th once all reforms in Act 53 are in effect (assuming other state tax policy remains constants). In terms of overall competitiveness, Pennsylvania will move from 29th to 17th.
In the research note, the Tax Foundation, which is a leading, independent policy-focused non-profit that provides policy research and analysis, encouraged lawmakers to consider accelerating the CNIT phasedown, amend state tax law so as to conform with federal treatment of net operating loss carry-forwards, extend the carry-forward provisions to pass-through entities, and make changes to how income and expensing are treated under state law. The analysis also presents a cautionary tale by noting the repeated delays that occurred in the scheduled phase-out of the state’s Capital Stock and Franchise Tax.
Pennsylvania also climbed six spots this year in CNBC’s annual rankings of the top states for business, from 23 to 17. The financial news outlet gave the state high marks among states for the quality of its educational systems, technology and innovation sectors, access to capital, and infrastructure, but scored Pennsylvania at the middle or lower end for economic growth, workforce, and business friendliness measures.