Subject: [big campaign] Walker's Latest Corporate Tax Break: Massive Loophole or Empty Promise?
From: Aniello Alioto <[email-masked]>
To: [email-masked]
Date: Thu, 7 Oct 2010 11:23:36 -0400
List-Id: <bigcampaign.googlegroups.com>

FYI

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From: One WI Now <[email-masked]>
Date: Thu, Oct 7, 2010 at 11:20 AM

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*For Immediate Release
October 7, 2010*
*Contact: Robert Doeckel
Phone: 608-217-0194*

 Walker's Latest Corporate Tax Break:
Massive Loophole or Empty Promise? *Walker Promise Would Either Open Massive
Loopholes or Apply to Virtually No Businesses**
*
Madison – Milwaukee County Executive Scott Walker, as part of his three-page
agenda, has called for making “Wisconsin a highly attractive place to start
a business by eliminating corporate taxes for the first two years of
operation.” Analysis by One Wisconsin Now shows the plan would either be a
budget-busting corporate loophole or would apply to few, if any businesses.

“Once again, Scott Walker offers talking points, but no real solutions to
create jobs in Wisconsin,” said Scot Ross, One Wisconsin Now Executive
Director. “Scott Walker already has a $7-billion hole to fill because of the
$3-billion deficit and his $4-billion in tax breaks to the rich and big
business, and now he offers sound-bites masquerading as policy proposals.”

The analysis by One Wisconsin Now, based on Walker’s “plan,” featured on his
website and reiterated in statements and the recent gubernatorial debate,
shows the following:

   - Walker’s two-year corporate tax holiday is either hopelessly expensive
   because it eliminates so many taxes, or utterly irrelevant because it
   eliminates virtually no taxes.
   - If Walker is talking about “corporate” taxes, his proposal would not
   apply to any business structured as a partnership, or a sole proprietorship,
   or an LLC, or even an S-corporation, all of which pay taxes through the
   individual income tax and not the corporate tax. Therefore, Walker’s “plan”
   sounds grand, but its scope is actually quite narrow. *Only a small
   number of true start-ups are structured as regular corporations subject to
   the corporate income tax.*
   - If Walker’s “plan” is truly aimed at startups, few of them make money
   during their first two years, so they would have no income tax to pay under
   the current system. In fact, under the current system they are able to use
   losses in the first two years to offset profits in subsequent years. If
   Walker’s proposal exempts them from taxes it might very well eliminate their
   ability to carry these losses forward. This means *Walker’s “plan” would
   actually cost the companies money when they do start being profitable.*
   - If Walker’s “plan” is actually broader than just true startup – for
   example, it includes new operations in the state set up by existing firms —
   then it opens an enormous loophole for profitable companies simply to
   re-incorporate every two years in order to enjoy a perpetual tax exemption.
   *Given that the corporate income tax brings in well over a half-billion
   dollars a year, Walker’s loophole would be devastating to state finances.
   *

Walker has recently offered additional business tax break plans, while
providing neither a cost amount, nor a mechanism to pay for them, including
one to cut manufacturing taxes and reducing small business taxes by 20
percent. [*Milwaukee Journal Sentinel*, 9/20/10, 11/2/09]

“Scott Walker will say anything to get elected and this proposed corporate
tax break is a grand-sounding idea with absolutely no meaningful content,”
said Ross. “Unless Walker’s real intention is to open up the biggest
corporate loophole in Wisconsin history and bankrupt the state.”

More information about Scott Walker’s record of mismanagement and the
disastrous results can be found at
www.ScottWalkerFailureFiles.com<http://onewisconsinnow.pnstate.org/site/R?i=cJjly1Lb4Imwn2WevjALvg..>.

# # #

One Wisconsin Now is a statewide communications network specializing in
effective earned media and online organizing to advance progressive
leadership and values.

Media Inquiries: (608) 204-0677 | Email: [email-masked]

One Wisconsin Now<http://onewisconsinnow.pnstate.org/site/R?i=_rmi4ep8hpa-QGASpjYbhA..>|
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One Wisconsin Now. © 2010 All rights reserved.

-- 
Aniello Alioto
National Political Director
[email-masked]
502.664.2420

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