Schimminger Introduces Business Tax Phaseout
Assemblyman Robin Schimminger, who chairs the New York State Assembly’s Committee on Economic Development, Job Creation, Commerce and Industry, today announced that he has introduced legislation to phase out the state’s corporate franchise tax for manufacturers over a two-year time frame.
Despite losses of manufacturing companies and jobs over the years, in 2002 there were over 21,000 manufacturers employing more than 641,000 employees in New York State, according to the most recent Economic Census information from the U.S Census Bureau. “From auto parts manufacturers to medical instrument makers, and from bakers to candlestick makers, manufacturing companies make goods which, when sold, return wealth to the communities in which they are located,” said Schimminger. “Our state has to provide these companies with reasons to stay and continue to provide good jobs and contribute to our economic growth. To keep manufacturers and succeed in attracting new ones, we must improve our state’s economic competitiveness. Eliminating the corporate franchise tax for manufacturers is a bold measure that will let corporate decision-makers know New York is dead serious about being a state where their businesses can succeed and grow.”
The legislation would allow companies that are principally engaged in manufacturing to be exempt from 50% of the corporate franchise tax beginning January 1, 2006, and to be completely exempt as of January 1, 2007.
“Many recent tax incentive programs and opportunities provided by the state have been focused on attracting new businesses,” said Schimminger, “However, there are tremendous growth opportunities right here within our existing manufacturing base, particularly in upstate
New York where manufacturing is an important component of local economies. It makes all kinds of sense to implement incentives and tax reductions that will both help us attract new companies and grow and retain the manufacturing businesses we already have. Simply the enactment of this manufacturers’ corporate franchise tax phaseout will signal that New York State is aimed at being more hospitable to companies which provide good-paying jobs and bring wealth into the state.”
“Most of New York’s future growth will come from businesses that are already here. Eliminating the corporate income tax on manufacturers would be a bold step which would attract investment and jobs both from companies considering locating in New York State and those now here that are struggling to compete,” said Brian McMahon, president of the New York State Economic Development Council.
“Manufacturing is a vital segment of New York’s economy that provides high paying jobs to New Yorkers,” said Daniel B. Walsh, president and CEO of The Business Council of New York State. “This legislation shows that its sponsors are serious about easing New York’s high business costs and helping manufacturers survive and prosper.”
“This measure would solidify New York State’s commitment to manufacturers that have operated and invested in our state and to their workers,” concluded Schimminger.