Dear Senator,
On behalf of National Taxpayers Union (NTU), the nation’s oldest taxpayer advocacy organization, I write to express our strong opposition to House Bill 220, the National Retail Fairness Act. This proposed legislation would unwisely establish a narrowly-focused seven percent corporate income tax on C corporation vendors in the retail, hospitality, and food services sectors. Wyoming has a longstanding legacy of supporting pro-growth tax policies, but enacting this legislation could severely jeopardize the state’s business-friendly climate. To protect job creators, workers, and taxpayers, we respectfully urge you to oppose House Bill 220 and any similar tax increase legislation.
As you may be aware, Wyoming currently holds the number one business climate in the country, according to the nonpartisan Tax Foundation. Possessing such an enviable position can, in large part, be attributed to Wyoming’s lack of a corporate tax. Adopting a discriminatory tax on just a select few business sectors would result in a drop in this index and create burdens for business owners across the state and for out of state businesses interested in investing in Wyoming. Despite this tax only being applied on a small mix of industries, NTU is particularly concerned that this gambit could be a foot in the door to a statewide introduction of a corporate income tax. As we have seen in many states across the country, such a scenario is entirely possible.
Furthermore, Wyoming would lose its competitive edge of being just one of two states in the country without a business level tax. In fact, for the affected businesses, a seven percent tax rate would be significantly higher than most neighboring states. An unintended consequence could result in some corporations choosing neighboring states for franchise expansions. To that end, hiking corporate taxes can have disastrous consequences on any economy. Siphoning capital from businesses leaves fewer resources to invest in machinery, equipment, and technology, all of which help boost productivity and fuel economic growth. There is much evidence that higher taxes are ultimately passed on to shareholders, workers, and consumers, thereby resulting in fewer jobs, higher prices and sluggish wage growth for working families.
At a time when states all over the country are reaping the benefits of federal tax reform by lowering their tax burdens, Wyoming is potentially preparing to do the opposite. By passing House Bill 220, lawmakers will be effectively saying “no thanks” to new investment and jobs. Accordingly, we encourage you to keep these concerns in mind as you hopefully work toward a more fiscally responsible future for Wyoming taxpayers by opposing House Bill 220.
Sincerely,
Thomas Aiello
Policy and Government Affairs Associate