Studies Released on Corporate Franchise Tax
Gongwer News Service - May 23, 2005
Gongwer News Service
Separately, government program advocates and researchers issued studies of budget-related issues recently, finding fault with majority Republicans’ plans to eliminate the corporate franchise tax and the tangible personal property tax.
On Monday, the Cleveland-based Policy Matters Ohio released a study entitled “Strengthen, Don’t Scrap Ohio’s Corporate Franchise Tax” and argued that the plan to replace the CFT and the tangible personal property tax with a gross receipts-based “commercial activity tax” falls short for a number of reasons, including the fact that the CAT receipts won’t fully replace the estimated $2.26 billion in estimated foregone revenue by 2011.
“Wiping out the corporate franchise tax would mean that highly profitable companies no longer would have any obligation to pay taxes based on their profits, violating a bedrock principle of fair taxation,” states the report, which provides a few recommendations for altering the CFT to make it more productive as a revenue source and more difficult to skirt by aggressive “tax planning.”
On Friday, the Cleveland-based Center for Community Solutions issued reports on the impacts of the TPP tax repeal on schools and local governments, and Ohio’s reserve of Temporary Assistance to Needy Families (TANF) federal block grant funds.
The Center also released on Monday a paper arguing for the spending of more funds by the Department of Job ands Family Services on childcare and the Early Learning Initiative in the budget. On the latter subject, the Center’s researchers suggest the agency has available funds to more fully finance the initiative.