updated: 2/16/2011 7:50:36 AM
Legislation that would reduce Indiana's corporate income tax rate by 20 percent has been approved by the Senate Committee on Tax and Fiscal Policy and can now be considered by the full Senate. The bill also addresses recommendations from a summer study committee to promote economic development, including creation of educational programs on entrepreneurship and identifying methods of commercializing technology and other research and public universities.
Source: Inside INdiana Business
February 15, 2011
Indianapolis, Ind. -- Indiana’s Senate Committee on Tax and Fiscal Policy voted 8-2 today in support of a proposal crafted by State Sen. Brandt Hershman (R-Lafayette) fostering the creation of private-sector jobs and promoting economic development by lowering corporate income taxes.
Senate Bill 589 decreases Indiana’s corporate income tax rate by 20 percent and implements recommendations made by last summer’s Economic Development Study Committee – a bipartisan panel of lawmakers and business leaders who examined ways to improve economic growth statewide.
“As the proposal moves through the process, recommendations by the economic panel continue to be modified and adjusted in order to pass a useful and effective new law,” Hershman said. “This includes making the proposal as revenue neutral as possible, which can be more easily achieved by lowering the corporate income tax rate from 8.5 percent to 6.5 percent, as opposed to 5 percent as originally proposed.”
Hershman said this adjustment combined with other provisions could help offset potential revenue losses while still achieving the goals of attracting new businesses and fostering job opportunities for Hoosiers.
“Unlike small companies, many of the largest corporations in Indiana can find ways to shift their taxes and reduce the amount they pay,” Hershman said. “By modernizing the corporate income tax rate – one of the highest when compared to other states and seen as a hindrance to job creation – the nearly 16,000 small Hoosier companies could grow and Indiana could become the destination of choice for new employers.”
SB 589 contains other provisions to foster economic development in the state:
-- Developing educational programs on entrepreneurship for students and members of the workforce;
-- Determining specific industries in which Indiana has advantages and should emphasize;
-- Finding ways to eliminate or reduce Indiana’s personal property taxes;
-- Requiring state and local economic development organizations to collaborate and report results; and
-- Focusing public universities on turning technology and innovation research into commercial uses.
Hershman’s SB 589 can now move to the full Senate for consideration.
Source: Indiana Senate Republican Caucus