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  • Closing Corporate Tax Loopholes Testimony: HB 1186 | PennPIRG
    2 shows that the effective rate of state taxes has trended sharply downward from a peak of about 8 percent to a low point below four percent The slight upturn in recent years may be because profits have been so high that they are harder to conceal or it may also result from some states becoming more aggressive in trying to close individual loopholes Figure 3 demonstrates that the declining share of corporate profit taxes in total state taxes has nothing to do with flagging profit rates On the contrary profits have been strong in past decades averaging 8 percent annual growth over the period and far more in recent years Figure 4 demonstrates what logically follows The falling effective rate of state income taxes largely as a result of growing tax avoidance leads to a falling share of the tax burden shouldered by corporate profits and thus increasingly from higher taxes and fees on individuals Nationwide the share of state taxes paid by corporate income taxes has fallen from about 10 percent to about 6 percent In Pennsylvania this decline has been even more pronounced falling from 12 6 percent in 1979 to 6 2 percent in 2005 One study which looked more specifically at Fortune 500 corporations in 2003 showed that these companies paid only one third of the statutory state level tax rates on profits 1 They were able to use exemptions write offs or other strategies to avoid the rest Moreover 28 percent of these large corporations paid no taxes at all for at least one year between 2001 2003 despite reporting 86 billion in profits to their shareholders during these no tax payment years No wonder that an April 2006 Gallop poll shows 70 percent of Americans agreeing that corporations pay too little in taxes In our opinion these lost revenues would not be such a problem if they were the result of popularly backed legislative intent They are instead generally the result of inaction and revenue departments being overwhelmed by tax avoidance strategies they are unable to police Moreover the result of these shifting tax burdens is a tax burden that places some companies at an unfair competitive disadvantage against others Companies with access to high powered tax lawyers and most notably those that can make use of out of state subsidiaries are unfairly favored by the present system We believe that Pennsylvania will best thrive when businesses prosper based on their productivity and ability to innovate rather than their opportunities for tax avoidance 2 How Combined Reporting Works California was the first state to create combined reporting in 1937 California decided to get out of the business of outfoxing corporate tax lawyers rather than sorting through transactions between subsidiaries and trying to establish which might be sham transactions and whether they reflected the true corporate structure of these entities Companies with subsidiaries were simply asked to file together as a single entity With combined reporting the question of which subsidiary should be assigned

    Original URL path: http://www.pennpirg.org/blogs/blog/pap/closing-corporate-tax-loopholes-testimony-hb-1186 (2016-04-27)
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  • Reducing political access of powerful interests | PennPIRG
    partisan environment like the U S Congress is as we have now seen impossible This is not to say that members of Congress are any less capable than others to self police no one self polices well In the Executive Branch there is an Office of Government Ethics Businesses have outside auditors Disciplinary boards for lawyers and doctors have strict rules regarding conflicts of interest Congress needs independent and professional oversight and enforcement of the rules Under the bill Congress would still maintain final responsibility for any sanction against a member The oversight office would receive complaints and have authority to investigate where evidence suggests a violation has occurred The importance of the office is that there will be an impartial nonpartisan review of the complaints While some have expressed concerns about the filing of frivolous complaints the change actually offers members better protection against false accusations Current practice is for outside groups to send up unofficial and public complaint letters with accusations that go to the ethics committees but are never resolved In the last election some members found themselves answering questions about those unresolved accusations The proposed system would establish a set amount of time for handling complaints and to determine if a complaint was frivolous Members would then receive notification from a nonpartisan independent entity testifying to the fact that there was no foundation to baseless attacks The ethics and lobby reform bill adopted with almost unanimous support closed many of the loopholes that have allowed undue influence of powerful lobbyists To ensure that the new rules are more than paper tigers Congress must also move to create outside professional oversight to enforce the rules and give assurance to the American people that the new Congress will different from the last Democracy Search form Search About Issues

    Original URL path: http://www.pennpirg.org/blogs/blog/pap/reducing-political-access-powerful-interests (2016-04-27)
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  • Transportation Funding Testimony | PennPIRG
    At minimum the agencies need enough revenue to close their existing budget shortfalls However the best public policy would be to dedicate revenue streams that can be expected to grow along with anticipated future needs including the rising costs of fuel and health care as well as reasonable capital investments Reliability Agencies need to know how much in state subsidies they can rely on over time in order to plan for the future and need to be assured that funding sources are stable enough to depend upon This will also allow agencies to maximize their investments by allowing them to secure as many federal matching dollars as possible The PennPIRG Education Fund is advocating the following eleven avenues through which to generate a permanent sufficient and reliable revenue base for our public transit systems All of these mechanisms have a logical nexus with the public goods conferred by transit and help recoup the costs vehicular travel displaces onto the general public We are not advocating for specific rates or fee amounts but rather we are asking that the Commission consider these recommendations as viable and appropriate funding sources Of course we would welcome the opportunity to work with the Department of Revenue if these proposals are ultimately put in place First let me address the expansion of existing revenue streams Real estate transfer tax There is currently a 1 realty tax of which 7 6 mills 7 60 per 1 000 is allocated to public transit Accessibility to public transit increases property values so it makes sense to invest some of this benefit back into the system Conversely developments that are not located near transit stops require vehicular traffic that displaces costs onto the general public It therefore makes sense to recover some of these costs by funding our transit systems which helps reduce the damage caused by excessive traffic In response to fears that this may impact a slowing housing market let me say that several states with high reality transfer fees have grown very fast particularly Florida and Nevada It should also be noted that the industry s brokerage fees impose their own six percent levy on home sales which gets passed on to consumers There should be a balance between their profit margins and the costs they disperse onto the general public Rental car tax Increase the current 2 day auto rental tax This makes economic sense because visitors in rental cars do not pay all the fees in state drivers pay to defray the costs of driving Tire tax Increase the existing 1 excise tax on the sale of tires This tax makes sense because tires clog our landfills and pollute our waterways Proper disposal of tires in government waste sites is expensive The tax is also tied to the amount of driving one does the more miles you put on your tires represents additional costs displaced onto the general public It is logical to recoup some of these costs at the point of purchase Parking

    Original URL path: http://www.pennpirg.org/blogs/blog/pap/transportation-funding-testimony (2016-04-27)
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  • Testimony on Potential Lease of the PA Turnpike | PennPIRG
    as Governor Rendell s announcement made clear Among the subsidies without which there would be no highway privatization are provisions of the federal tax code that allow highly accelerated depreciation and that allow private contractors to borrow low cost money if they create a nonprofit affiliate and use it issue tax free bonds These subsidies are a free lunch for private road operators but not for the public For instance tax free bonds mean that companies and the investments from other investors into their operations produce lower tax revenues to spend on public needs and infrastructure Moreover permitting the creation of sham nonprofits solely to subsidize individual private companies creates a dangerous precedent The lines between for profit and not for profit entities is already a fragile one but one in which it is important to maintain clear boundaries These distinctions were created specifically to protect charity activities and other vital social functions that are not ordinarily profitable Turning those distinctions into mere tax loopholes will have serious costs both for protecting important social functions and because other public revenues will be lost Another hidden subsidy allows private operators to qualify for a highly accelerated tax depreciation that allows it to write off costs far more quickly than they are actually incurred This may mean that the cost of the initial up front payment can be recovered in 15 years for instance 1 5 of the contract term This is like giving the private operator a no interest loan on the value of these tax write offs for 50 years The chief reason these road deals are so long is to take advantage of this hidden subsidy from taxpayers Accelerated depreciation is available only if the private company agrees to a very long contract one that extends past the expected useful life of the asset What incentives will such a situation create PTP may have an incentive to walk away after it has reaped this tax benefit but before major new investments would be required Certainly the investor has an incentive to limit its investment in the infrastructure as the termination date approaches It might instead be more profitable to use the threat of disinvestment or abandonment as a way to induce the Commonwealth to make other concessions Loss of Public Control The language of the proposed Turnpike contract shows that the parties were sufficiently concerned about unpredictable future events that they tried to include provisions to provide greater certainty for investor and Commonwealth alike However these provisions do more than just guarantee that sufficient revenues are generated for PTP They would also affect the exercise of public power by Pennsylvania s government at all levels In the contract these provisions fall under three definitional categories compensation events delay events and adverse actions When any of these occurs it can require the Commonwealth to compensate PTP for lost revenues Since the Commonwealth is considering privatizing the Turnpike in order to generate public revenue it should want to avoid anything that could create a compensation event a delay event or an adverse action The contract includes a number of provisions that create compensation events which arise when Turnpike traffic and thus toll collections are negatively affected The contract says Compensation Event means i any applicable entry on the Turnpike by the Commonwealth pursuant to Section 3 7 a v through Section 3 7 a ix provided that the Concessionaire s use of the Turnpike as a highway is materially impaired resulting in Losses or reduced Turnpike Revenues ii the Concessionaire s compliance with or the implementation of a Required Modification pursuant to Section 5 2 iii the Concessionaire s compliance with or the implementation of any modified or changed Operating Standard as contemplated by Section 6 3 b iv the termination of an agreement with a Vendor as contemplated in Section 7 2 d v the occurrence of an Adverse Action as contemplated in Article 14 vi the circumstances described in each of Section 2 5 i Section 4 1 a Section 4 2 Section 5 2 and Section 15 2 d vii any breach of the covenant set forth in Section 3 10 b or viii the occurrence of a Commonwealth Default as contemplated in Article 16 Concession Compensation means with respect to a Compensation Event compensation payable by the Commonwealth to the Concessionaire in order to restore the Concessionaire to the same after Tax economic position that the Concessionaire would have been in if such Compensation Event had not occurred and calculated in accordance with Section 15 1 b There are many compensation events listed in the contract that mean the Commonwealth must pay money to PTP However even some situations that appear to be excluded from the definition of compensation event may still end up with the Commonwealth owing PTP more money For example the contract allows the Commonwealth to enter the Turnpike to ensure the contract is being complied with to make necessary repairs in the case PTP defaults or to deal with emergencies Nonetheless each of those acts may mean money is owed to PTP The reason is that the contract says that in the first two situations the Commonwealth may enter only at reasonable times and upon reasonable prior notice In the case of emergencies the police fire emergency services armed forces or other security or emergency personnel may enter the Turnpike only if they reasonably believe there is a situation that has caused or has the imminent potential to cause injury or damage to people or property and if PTP is given notice that is practicable under the circumstances Lawyers know that subjective terms such as reasonable provide the basis for disputes and litigation At present Pennsylvania s emergency responders react as best they can in a crisis but the contract would force them to hesitate Is it clear that this situation is a serious threat worth impeding the flow of traffic and tolls Could it be proved that it was reasonable to believe

    Original URL path: http://www.pennpirg.org/blogs/blog/pap/testimony-potential-lease-pa-turnpike (2016-04-27)
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  • PennPIRG | Standing Up To Powerful Interests
    print The proposed contract to privatize the Pennsylvania Turnpike is available on the Internet but most people won t read one word of the 686 page document Not only is its length intimidating but it begins with 21 pages of specialized definitions such as compensation event cross referenced to other parts of the contract Might as well post a Keep Out sign Keep Reading News Release Tax House Finance Committee Holds Hearing on Combined Reporting to Level the Playing Field on Taxes PITTSBURGH Today the House Finance Committee held a hearing on combined reporting an accounting reform that would prevent multi state companies from shifting profits to out of state subsidiaries as a way to avoid Pennsylvania taxes Neighboring New York and West Virginia instituted this tax modernization last month Keep Reading Pages first previous 51 52 53 54 55 56 57 58 59 next last Search form Search About Issues Stop the Overuse of Antibiotics Campaign for Safe Energy Democracy For The People Stop the Highway Boondoggles Close Corporate Tax Loopholes Making Health Care Work Protecting Consumers Label GMO Foods Reining in Wall Street Act Now Jobs Donate Newsroom Make a Donation Resources Reports Get our RSS feed Our Affiliates Our Sister c 3 Are you a student Our Federation Featured Position PennPIRG Internship Work on some of the hottest political issues of the day from fighting the overuse of antibiotics on factory farms to promoting campaign finance reform and tackling Citizens United improving voter access for students and underrepresented communities and advocating for a 21st century transportation system Job Description We have the momentum Consumers like you convinced McDonald s and Subway to take action to protect public health This summer we re asking KFC to do the same Will you help win change Donate Now Get Big

    Original URL path: http://www.pennpirg.org/home?page=57 (2016-04-27)
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  • PennPIRG | Standing Up To Powerful Interests
    face a far lower state income tax bill In fact 71 percent pay nothing at all Keep Reading Report PennPIRG Education Fund Health Care Delivering on the Promise The recently passed federal health care reform law will make significant changes in how health insurance and health care work for consumers businesses and local and state governments as well as how insurers and providers operate But whether Americans experience improved care lower costs and greater access depends largely on what happens next Keep Reading Pages first previous 47 48 49 50 51 52 53 54 55 next last Search form Search About Issues Stop the Overuse of Antibiotics Campaign for Safe Energy Democracy For The People Stop the Highway Boondoggles Close Corporate Tax Loopholes Making Health Care Work Protecting Consumers Label GMO Foods Reining in Wall Street Act Now Jobs Donate Newsroom Make a Donation Resources Reports Get our RSS feed Our Affiliates Our Sister c 3 Are you a student Our Federation Featured Position PennPIRG Internship Work on some of the hottest political issues of the day from fighting the overuse of antibiotics on factory farms to promoting campaign finance reform and tackling Citizens United improving voter access for students and underrepresented communities and advocating for a 21st century transportation system Job Description We have the momentum Consumers like you convinced McDonald s and Subway to take action to protect public health This summer we re asking KFC to do the same Will you help win change Donate Now Get Big Money Out Voters In Super PACs and mega donors are drowning out the voices of regular Americans but together we can take our elections back The momentum is already building will your voice be heard What can I do Stop the Highway Boondoggles Americans are finding alternative ways to

    Original URL path: http://www.pennpirg.org/home?page=50 (2016-04-27)
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  • PennPIRG | Standing Up To Powerful Interests
    Pennsylvania cash strapped governments are struggling to plug gaping holes in their budgets scarred by the impacts of the economic crisis At the same time Pennsylvania s roads and bridges remain congested and in desperate need of repair This is PennPIRG s fact sheet about the effects of Toll Road Privatization Keep Reading Report PennPIRG Education Fund Facts About Toll Road Privatization Across Pennsylvania cash strapped governments are struggling to plug gaping holes in their budgets scarred by the impacts of the economic crisis At the same time Pennsylvania s roads and bridges remain congested and in desperate need of repair This is PennPIRG s fact sheet about the effects of Toll Road Privatization Keep Reading Pages first previous 48 49 50 51 52 53 54 55 56 next last Search form Search About Issues Stop the Overuse of Antibiotics Campaign for Safe Energy Democracy For The People Stop the Highway Boondoggles Close Corporate Tax Loopholes Making Health Care Work Protecting Consumers Label GMO Foods Reining in Wall Street Act Now Jobs Donate Newsroom Make a Donation Resources Reports Get our RSS feed Our Affiliates Our Sister c 3 Are you a student Our Federation Featured Position PennPIRG Internship Work on some of the hottest political issues of the day from fighting the overuse of antibiotics on factory farms to promoting campaign finance reform and tackling Citizens United improving voter access for students and underrepresented communities and advocating for a 21st century transportation system Job Description We have the momentum Consumers like you convinced McDonald s and Subway to take action to protect public health This summer we re asking KFC to do the same Will you help win change Donate Now Get Big Money Out Voters In Super PACs and mega donors are drowning out the voices of regular

    Original URL path: http://www.pennpirg.org/home?page=51 (2016-04-27)
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  • PennPIRG | Standing Up To Powerful Interests
    out of control and enabled insurance companies to run roughshod over consumers for decades until now Keep Reading News Release Health Care CBO s estimates on health insurance premiums Today s CBO report is great news A majority of individuals purchasing individual or family health insurance in the exchange would receive reductions of 56 to 59 percent in premiums below what they would pay under current law Keep Reading Media Hit Consumer Protection Big dangers in little hands KINGSTON Dangerous toys can still be found on America s store shelves despite recent legislation and increased safeguards Keep Reading Pages first previous 49 50 51 52 53 54 55 56 57 next last Search form Search About Issues Stop the Overuse of Antibiotics Campaign for Safe Energy Democracy For The People Stop the Highway Boondoggles Close Corporate Tax Loopholes Making Health Care Work Protecting Consumers Label GMO Foods Reining in Wall Street Act Now Jobs Donate Newsroom Make a Donation Resources Reports Get our RSS feed Our Affiliates Our Sister c 3 Are you a student Our Federation Featured Position PennPIRG Internship Work on some of the hottest political issues of the day from fighting the overuse of antibiotics on factory farms to promoting campaign finance reform and tackling Citizens United improving voter access for students and underrepresented communities and advocating for a 21st century transportation system Job Description We have the momentum Consumers like you convinced McDonald s and Subway to take action to protect public health This summer we re asking KFC to do the same Will you help win change Donate Now Get Big Money Out Voters In Super PACs and mega donors are drowning out the voices of regular Americans but together we can take our elections back The momentum is already building will your voice be

    Original URL path: http://www.pennpirg.org/home?page=52 (2016-04-27)
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