|
Dan
Pilcher
CACI
Senior Vice President
& Chief
Operating Officer
Phone:
303.866.9600
E-Mail:
dpilcher@cochamber.com
Monday,
August 10, 2009
CACI Survey Shows State Tax Incentives Critical to Colorado
Companies
CACI today
released the results of its first-ever survey of Colorado
businesses and the local economic development community on the
potential elimination of current tax incentives.
The survey
reveals that eliminating current tax exemptions, exclusions,
deductions and enterprise zone credits will increase taxes on
businesses by millions of dollars. The responses came from
businesses both small and large throughout the state and from
across a number of industries.
The survey
shows that--irregardless of the size of the business or the
industry--the financial impact will be devastating to the
operations of firms and to their workers.
The survey
was undertaken by CACI because of the discussion that has been
initiated at the State Capitol by some legislators and state
leaders who are considering the elimination of current tax
incentives to offset revenue shortfalls in the State’s budget.
The survey
supports previous legislative decisions to create the tax
incentives to promote economic development and job growth.
Responses
from individual companies clearly indicate that the financial
impact will affect possible expansion or relocation decisions,
and the additional taxes will severely impact workers. When
asked what they would do if the incentives are eliminated, this
is how the respondents answered:
-
60
percent said they would halt or delay planned expansions;
-
46
percent said they would reduce workers’ wages or benefits,
or both;
-
49
percent said they would institute a hiring freeze;
-
45
percent said they would lay off workers; and
-
29
percent said they would relocate some or all operations to
other states or countries.
An example
of the financial strain to a small manufacturing business in
Denver is voiced by Susan Cirocki with Arrow Sheet Metal
Products:
“As a small manufacturing business, we are doing everything we
can to stay competitive in this marketplace. These exemptions
allow us to provide our customers with affordable prices that
are critical to our success. Eliminating the manufacturing
exemptions and enterprise zone credits would cost us hundreds of
thousands dollars a year which would create an incredible
financial strain on our business and consequently our
customers.”
Here’s
another response to the survey from Ray Czerwinski, Controller
for Waste Management of Colorado:
“As a company that employees over 1,300 employees, operations a
fleet of over 640 vehicles and provides a vital service to
communities in nearly every corner of the state, Waste
Management of Colorado is very concerned that the State is
considering repealing the Fuel Tax Rebate.
“Removal of this rebate will significantly impact our business
operations and result in a loss of over $300,000 annually.
Repealing this rebate will force our costs to increase, which
ultimately impacts our customers--customers that are already
facing difficult economic times.
“Furthermore, this doesn’t just impact Waste Management (or any
transportation or agricultural based business), but the cities
we serve that depend on the sales tax revenue generated off of
the rebate we receive. At a time when nearly every city in
Colorado is cutting costs, programs and even staff to address
significant budgetary shortfalls, repealing this rebate would
only compound the problem. In fact, at time when cities can’t
afford to lose a penny of sales tax revenue, this would cost the
cities we serve over $105,000 in revenue annually.
“In short, not only does Waste Management depend on the Fuel Tax
Rebate, but so do the customers and cities we serve. In the
end, cutting the Fuel Tax Rebate will have a negative
trickledown impact on Colorado’s citizens.”
To obtain
the report,
please click here. |
