Distributing a press release toward the end of the week is a great way to bury a story that you don't really want to be told. Well last Thursday, expert communicators working for the Corbett administration opted to release a new policy on how corporations can include bonus depreciation in determining their tax liability.
I know, I know, bonus depreciation can make your eyes glaze over, but what I'm talking about here is a policy that amounts to a $200 million giveaway to big businesses. Bonus depreciation is basically an accounting method that allows businesses an additional deduction for the cost of equipment purchases when the item is initially purchased.
Putting this in context, the state is looking at a $4 billion budget deficit and adultBasic health coverage for 42,000 people expires at midnight. Despite these issues, an internal decision was made by the Corbett administration to give away $200 million to corporations!
The most appalling part is that the biggest beneficiaries of this new policy are those corporations already taking advantage of a monster truck-sized loophole in the Tax Reform Code, often referred to as the Delaware Loophole. A quick reminder that this loophole is where corporations transfer profits to out of state subsidiaries and avoid paying taxes to Pennsylvania, costing our state millions of dollars in revenue, forcing small Pennsylvania businesses to pay more than their fair share.
This quiet action by the new administration is just another indicator of Gov. Corbett's priorities this year.