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07/30/2021 04:21 PM
Pennsylvania State Senate
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=S&SPick=20170&cosponId=25785
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Senate of Pennsylvania
Session of 2017 - 2018 Regular Session

MEMORANDUM

Posted: May 1, 2018 01:31 PM
From: Senator Bob Mensch and Sen. Andrew E. Dinniman
To: All Senate members
Subject: Expanding the 21st Century Manufacturing Innovation and Reinvestment Deduction Act
 
Last year, the 21st Century Manufacturing Innovation and Reinvestment Deduction Act was signed into law. This legislation provides an incentive to Pennsylvania manufacturers that make capital investments in excess of $100 million; giving them the ability to claim a deduction against their taxable income.

This initial program has been well received by the business community; however, many smaller-scale businesses have also approached us to ask how they can use the program to grow their businesses and create additional jobs. As a result, we will be introducing legislation to amend this section of the Tax Reform Code to provide an incentive to Pennsylvania manufacturers that make large scale investments in excess of $1 million dollars within the Commonwealth.

Specifically, this proposal will state that any manufacturer that makes a private capital investment of $1 million - $10 million will be able to claim a 10% deduction against its taxable income for a period of five years.

Additionally, any manufacturer that makes a private capital investment of $10 million - $100 million will be able to claim a 7.5% deduction against its taxable income for a period of five years.

Upon the completion of the capital project, and successful review of eligibility criteria, the manufacturer will be eligible for this tax deduction. The tax deduction is not a tax credit, it is non-deferrable, or transferable to another entity. The deduction cannot reduce the manufacturer’s tax liability by more than 50%.

Similar to its predecessor, this concept will permit Pennsylvania to provide an incentive to attract capital investment in our manufacturing facilities now without any negative impact on our budget process or revenue collections.

I hope you will join with us in support of this legislation. If you have any questions or concerns please contact Mark Fetzko.



Introduced as SB1193