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Dann Sides with Ohio Chamber in Blasting Taft's Reforms
"YOUNGSTOWN, Ohio -- State Sen. Marc Dann, D-32, Liberty, is siding with the Ohio Chamber of Commerce in opposing Gov. Bob Taft's bid to reform the state's tax system.In a letter dated March 10 to his fellow senators, Dann blasted Taft's proposed corporate activity tax, which would replace the corporate inventory tax, as "a risky scheme," "flawed," and an "economic depressant.""Yesterday I heard the Chamber of Commerce outline the problems of this new tax," Dann wrote. His letter reached many of his constituents in the Mahoning Valley, confusing a number with that chamber reference, says Thomas M. Humphries, president of the Youngstown/Warren Regional Chamber.The chamber of commerce the senator refers to is the Ohio Chamber, not the regional chamber, Humphries wrote members of the regional chamber.The regional chamber, he points out, has not taken a position on the governor's proposals. Indeed, the regional chamber will give Taft a respectful hearing when he visits Youngstown March 18, he stated. "At that time your regional chamber will weigh both sides of the issue and our board will make a decision on the governor's plan," Humphries said.While the regional chamber is a member of the Ohio chamber, Humphries continued, members should not assume the regional chamber marches in lock step with the state chamber.As Dann describes it, the corporate activity tax "taxes the total gross receipts of a business. Among its many problems, [it] will raise a company's tax liability for every dollar increase in sales and create a pyramid effect on business-to-business sales, raising prices at all points of the manufacturing supply chain."The governor's plan also calls for partially exempting new machinery and equipment from the tangible personal property tax, with a phase out of several years," Dann wrote. "Not only will business have to wait for the full phase out, the exemption doesn't even cover all tangible personal property. Under the proposal, all other categories, including furniture and fixtures, will remain taxed."As Dann sees it, Taft's proposals punish companies every time they would make a sale. The changes would stifle growth, he said. The senator from the 32d district faulted the governor on other aspects of his proposed reforms, saying they discourage rather than encourage education, research and investment in new technology.Dann and state Sen. Eric Fingerhut, D-Cleveland, are co-sponsoring a bill "to create the Regional Job Creation Loan Fund, a $2.4 billion program," he said, which would remedy many of the shortcomings he sees in Taft's proposals. Under the Dann-Fingerhut measure, the state would be divided into 12 economic development regions; each would receive $20 million a year for 10 years and each region could grant loans "for the modernization of machinery and equipment, making businesses more competitive and creating jobs."Dann offered no more specifics."