Wednesday, February 02, 2011
Combined Reporting Bill Introduced
Legislation to implement a corporate income tax system of unitary combined reporting was introduced this week in the Senate. The bill, SB 305, would enact combined reporting in 2012.
The Chamber has opposed combined reporting legislation for a number of years. Data from the Maryland Comptroller’s office shows that enacting combined reporting would result in massive shifts of tax liability between businesses, with many businesses paying more taxes and many paying less.
“Combined reporting would only further damage Maryland’s business climate in a year that employers are trying to climb out of this recession,” Maryland Chamber Vice President of Government Affairs Ron Wineholt said.
Combined reporting was one of the most hotly debated issues for the Maryland Business Tax Reform Commission, which met over the last two years to review business tax law in Maryland. The Maryland Chamber, along with many other businesses and business groups, argued that combined reporting would make Maryland’s tax laws less competitive, cause massive shifts in business tax liability, and needlessly increase the complexity and uncertainty of corporate taxes. Ultimately, the Commission agreed, and it voted 13 to 4 to recommend that the General Assembly not implement combined reporting in 2011.
Current law requires corporations doing business in the state to be taxed based on their payroll, property and sales in Maryland. Combined reporting arbitrarily assigns income to Maryland for all members of a corporate unitary group – even for those corporate entities having no presence in the state.
No hearing date has been set. For more information, contact Ron Wineholt at .(JavaScript must be enabled to view this email address).
Thanks for this excellent summary, has there been any movement on this issue? Has the Governor’s administration taken a position?