Wednesday, March 03, 2010
Let the Business Tax Reform Commission Finish its Work
Key committees of the Maryland General Assembly are considering legislation that would impose a system of mandatory unitary combined reporting for corporate income taxes in Maryland.
Corporations doing business in Maryland are currently 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.
The Maryland Chamber has opposed combined reporting legislation for a number of years. States that have adopted combined reporting have found that it results in massive shifts of tax liability between businesses, with many paying more taxes and many paying less. We believe it’s important to analyze the winners and losers of such a tax change and the impact on Maryland’s economy.
The Maryland Business Tax Reform Commission was created by the Governor and General Assembly during the 2007 special session to examine how businesses are taxed in the state. The commission is studying a variety of issues including combined reporting, apportionment, tax credits, tax exemptions and more. The Maryland Chamber is represented on the commission by our State Taxation Consultant Karen Syrylo, CPA. The group is scheduled to provide its recommendations to the General Assembly in December 2010.
During recent public hearings, Maryland Chamber Vice President of Government Affairs Ron Wineholt urged lawmakers to allow the Maryland Business Tax Reform Commission to complete its work before considering legislation to change the state’s approach to corporate taxation.
“The Commission should be allowed to evaluate another year of tax data and report back this December without having this issue prejudged by the General Assembly,” Wineholt said.
This is a priority issue for the Maryland Chamber. You can learn more the bills and access the Chamber’s position statements online here. For more information, contact Ron Wineholt at .(JavaScript must be enabled to view this email address).
