Scott to Repeat Reagan Mistake

Mar 26, 2011 by Editor Fred D

Is Governor Scott (FL-R) making the same mistake that the Reagan administration made in 1981?

Governor Scott wants to phase out the state income tax on corporations. That sounds great, going from 5.5% to 0%, but over a 7 year period.  The tax cuts of 1981 were phased in over several years, and the full effect was not felt till after the cuts were in full effect.

If Governor Scott is looking to move companies in and move them fast why does he not just go to 0% right away? Scott should consider not just killing the tax on companies over night but also providing Delaware style protections for those companies.

With companies having those protections in place and not having to pay the over 8% in Delaware taxes there would be no reason to remain domiciled in Delaware.  Even companies not needing the full protections would be motivated to move right away. Small business owners would have an opportunity to take advantage of money savings also.

Companies are domiciled and have domiciles in states or counties to take advantages of certain protections and cost savings. Even if a company moves itself to Florida without a physically domiciled office, they will have to engage an agent. That in itself will help with the employment issues and help increase employment. Those moving their structures to the state will have to pay the states fees that shall still remain.

Governor Scott has put forward a 7 point plan to take place over a seven year period. Read it here, http://letsgettowork.state.fl.us/.