Reduce inflation by eliminating business tax 43 other states do not impose
Thank you Rob Flaks of 47 ABC – WMDT for sharing my proposal on eliminating gross receipts taxes on businesses that sell consumer goods and targeted rising inflation.
Representative Bryan Shupe is looking to change how taxes work for businesses selling consumer goods in the first state, by having Delaware mirror policies found in 43 other states and move away from using a gross earnings tax on businesses that fit the consumer goods category.
The change would allow for restaurants, shops, and grocery stores to be subjected to a net tax, after the businesses pay expenses such as rent and payroll, rather than being charged taxes prior to paying those costs.
‘We should be charging businesses on the profit they are making, they might have 100,000 dollars in revenue but they could be losing money with 150,000 expenses I don’t think we should be taxing them on the net, we don’t operate like that for individuals and the federal taxes also don’t operate like this,” Shupe said.
Rep. Shupe says a general repealing of the gross income tax has failed in the past, but he believes this measure would target businesses that are on the front lines of inflation in the first state, while largely skipping over LLCs that are incorporated in the first state.
“Since we see inflation happening on consumer goods whether it eggs or milk or food this can really allow for those prices to go down those businesses that are selling will not have to pay an accelerated price through those taxes,” he said.
Rep. Shupe says they are working with the state budget office to determine how much revenue loss the change would bring, with the measure set to be introduced in March when the session reconvenes.