Local Senator Offers Business Tax-Cut Plan
State Sen. David Bates (R-Dist. 32) has introduced a bill to lower the state's "corporation franchise tax" for businesses — what do you think?
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In a move that he said could help small businesses create more jobs in Rhode Island, state Sen. David E. Bates (R-Dist. 32, Barrington, Bristol, East Providence) recently introduced a bill that would lower the state's corporation franchise tax for new and existing businesses.
“A $500 minimum corporation franchise tax [imposed under current state law] is a significant amount to many small, start-up companies and is money they could more wisely use to make payroll or reinvest in their company,” Bates said in a statement. "If we are serious about growing jobs in Rhode Island, and if we are serious about making it easier for entrepreneurs to start and grow businesses here, then reducing the cost for small businesses to operate should be one of our foremost goals.”
Bates's proposal would allow existing businesses to reduce their franchise tax by $100 per employee for up to four employees, effectively reducing the minimum amount to $100. For start-ups, Bates's bill would provide a three-year "grace period" before the tax would take effect.
“I realize that if enacted this bill would result in less tax revenue taken in by the state, but what is most important is that we provide a boost to small and start-up concerns," said Bates. "This bill is another example of how we can help cut costs for those businesses already here and make it more attractive and less expensive for new businesses to start and grow.”
Bates's proposal has garnered co-sponsorships from Sens. Louis P. DiPalma (D-Dist. 12, Middletown, Little Compton, Newport, Tiverton), William A. Walaska (D-Dist. 30, Warwick), Frank Lombardo III (D-Dist. 25, Johnston) and Senate Majority Leader Dominick J. Ruggerio (D-Dist. 4, Providence, North Providence).
It has been referred to the Senate Corporations Committee for a hearing to be scheduled.
What do you think?
Is Sen. Bates's proposal a good idea? Do you think it will help attract new businesses and allow existing companies to hire new workers?
Or is a potential savings of $400 too small to make a difference?
Have your say in the comments section below.
sheila Morris-Sardinha
7:19 am on Monday, February 4, 2013
Thank you for introducing this bill. Let's just hope your colleagues are business savy enough to pass it, along with the following entities that would need to agree, uphold, and assist this along. This could mean a world of difference to a small business, remove one of the potential hurdles/roadblocks for startups, and inch our state forward to being 'business friendly'. Small business is the foundation of our economy. Energize/support/reward small business and you'll see our economy inching it's way back!
bristolyte
3:21 pm on Monday, February 4, 2013
I fail to understand why they cannot simply pro-rate this according to a the size/profit of a corporation. The only thing good I see is the 3 year grace period for start ups. The state stands to lose significant income from large corporations that employ many people and can afford the $500 with ease, while smaller businesses that may only employ one or two people will still pay. And if you think for one minute that the state of RI won't find someway to get their hands back in the pocket of small businesses to make up the shortfall caused by mostly larger businesses no longer paying, then you haven't lived in RI long enough. We have proudly earned our status as the worst state to do business.
Jack Baillargeron
6:56 pm on Monday, February 4, 2013
Feel good crappola, at a little over a dollar a day max. Give me a break. Eliminate the tax all together, we might actually go from 50th worst to 49. Just saying