Capital Stock and Franchise Tax finally phased out
NFIB Pennsylvania has fought for years for the elimination of the Capital Stock and Franchise Tax (CSFT) which is patently unfair because it taxes a business based on assets even when that company doesn’t turn a profit. In addition, Pennsylvania was one of the only states that taxed businesses on both their income and capital value. Now, finally, after years of delays, we can celebrate the final elimination of that tax as we welcome in the New Year.
The CSFT has been a tax burden on large and small businesses for 171 years. The 2000 General Assembly passed a bill that was signed by the Governor Tom Ridge to phase out the CSFT over a ten year period. During the planned phase out there were multiple delays when state spending took precedence.
As of December 31, 2015, the CSFT has expired. This is a major victory in the effort to simplify Pennsylvania’s Tax Code. This year as Pennsylvania businesses file their 2015 fax forms, it will make the last time they have to deal with the hassle of filing this antiquated tax.
NFIB/PA Executive State Director Kevin Shivers applauded the end of the Capitol Stock and Franchise Tax.
“Good Riddance to this unfair tax which was like a slain beast repeatedly coming back to life. Elimination of the CSFT will be helpful to new businesses that have invested in equipment but aren’t making a profit get a healthy start. It will no longer push companies that are having a slow year over the brink and it will make Pennsylvania a better place to locate your business.”