Legislation would kill business tax credits

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 Four bills that business leaders say will drastically harm businesses and affect job creation are headed to the Senate after passing the state House of Representatives this morning.

House Bill 1190 will suspend the exemption on energy used in processing and manufacturing, effective March 1.

“Not only is the financial impact huge, but the lack of planning and budgeting time could severely affect companies as they have to pay this unexpected tax,” said the Greater Colorado Springs Chamber of Commerce.

House Bill 1192 will make every company that uses downloaded software pay a tax on every item they download. The bill is also effective March 1, giving businesses little time to incorporate the tax into their budgets.

House bill 1199 will limit the amount a corporation can reduce its state taxable income by carrying forward a net operating loss. Currently, there is no limit on the amount a business can carry forward – but this bill creates a limit of $250,000 for the next three years.

House bill 1200 is the Enterprise Zone Investment Tax Credit Deferral, and limits tax creditsfor blighted areas. Businesses in the affected areas will face limits to the existing credits.

The bills are being handed down as a single package, and were passed by the committee last week in the wee hours of the morning.

The package was created by Gov. Bill Ritter to help address the budget shortfall facing the state, said Tony Gagliardi, director of the Colorado division of the National Federation of Independent Businesses.

“Unfortunately this budget scheme is once again yoked to the backs of Colorado’s job creators, small businesses,” he said. “It is about small business, not big business – nor big government. That is the lead horse pulling every state’s economic wagon. Adding more lashes to it does not increase the speed, it only slows the progress.”

The legislation – and about nine other bills that will also affect small businesses – drew the ire of the business community throughout the state. Thursday, the Colorado Springs Chamber of Commerce joined chambers from Denver and Aurora, as well as other small business groups, to rally at the Capitol and protest the bills.

If the bills pass the second reading, there will be only one more reading in the House of Representatives before they move to the Senate.

2 Responses to Legislation would kill business tax credits

  1. Bill Ritter cannot retire soon enough! Why is it our governments, city, state and federal, always put the burden of their overspending on the backs of those who can least afford it. Small businesses, which now pay the highest employee health insurance premiums in the state, and also account for the largest employment gains, will be suffocated by the bills presently on the floor. If these measures pass, more employees will go without insurance, possibly without jobs. If the ratio of taxes vs. profit coming in changes much more, the state will see more businesses close their doors. That would really solver their budget deficit, wouldn’t it? Seems I heard something last week on the news about the Unemployment well being about dry…..?

    Wake up guys – you can’t tax business into prosperity. Business has had to pull in it’s horns and work within a smaller budget, so should you.

    Lynn Liggett
    February 1, 2010 at 12:00 pm

  2. What is happening now? More and more businesses will be closes and more individuals don’t have health insurance. You guys should wake up now!

    small business medical insurance
    February 3, 2010 at 1:03 am