Pennsylvania has finally begun the process of reducing its excessively high Corporate Net Income Rate. As of Jan. 1, the CNI dropped a full percentage point to 8.99 percent, as provided for in the monumental tax reform package enacted as part of last year’s state budget plan.
In accordance with Act 53, the CNI will now drop by half a percentage point on Jan. 1, 2024, and every subsequent year until it reaches 4.99 percent on Jan. 1, 2031 – which would put us at the eighth lowest rate in the nation.
Passage of Act 53 is already paying dividends for our state’s competitiveness. For example, the nonpartisan Tax Foundation noted that Pennsylvania’s ranking among the states in its State Business Tax Climate Index and our overall tax structure ranking will improve this year because of the CNI reduction.