BLOG: No More Delays in Making Pennsylvania More Business-Friendly

By: J.J. Abbott, Deputy Press Secretary

January 05, 2016

The Pennsylvania Capital Stock and Foreign Franchise Tax is older than you or me.

In fact, it’s older than any living Pennsylvania lawmaker; the tax was established in 1844, the same year James Polk was elected President of the United States beating Whig candidate Henry Clay, Samuel Morse sent the first telegraph message, “What hath God wrought,” and John Frémont became the first person of European descent to discover Lake Tahoe.

In 2000, Pennsylvania lawmakers decided it was time for the centuries-old Capital Stock and Foreign Franchise Tax to go; Pennsylvania businesses already pay a corporate net income tax and the outdated Capital Stock and Foreign Franchise tax created an unnecessary additional burden.

But it took 16 years and five governors before the unfair tax on business was finally phased out on the first of this year.

A Brief History of Attempts to Phase Out the Capital Stock and Franchise Tax

2000: tax’s elimination first proposed.
2002: delayed.
2003: delayed – again.
2009: delayed a third time.
2013: yet again, can was kicked down the road.

But, yesterday, after more than a decade of delays by a bipartisan group of past Governors in ending this antiquated tax on business, Governor Tom Wolf announced the final phase-out of the Capital Stock and Foreign Franchise Tax.


Reacting to the announcement, Pennsylvania Chamber of Business and Industry President and CEO Gene Barr told the Philadelphia Business Journal “the final elimination of the CSFT is a step in the right direction.”

As Governor Wolf noted in last year’s budget address, Pennsylvania’s economic prosperity has long been hobbled by an outdated tax structure that fails to incentivize job growth. It was well past time for Pennsylvania to finally remove the Capital Stock and Foreign Franchise tax from the books.



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