Daley named as Commerce Committee Democratic chairman
State Rep. Peter J. Daley, D-California, announced Wednesday that he has been reappointed to serve a third term as Democratic chairman of the House Commerce Committee for the 2011-12 legislative session, and proposed abolishing sales tax on the maintenance and sales of aircraft. Daley will be sworn in Jan. 4 for his 15th term as state representative.
The House Commerce Committee evaluates legislation involving the banking industry and financial services industries and works closely with several state agencies, including the Department of Community and Economic Development and the Pennsylvania Housing Finance Agency, to ensure that Pennsylvania stays competitive in a world marketplace.
“As Pennsylvania faces another difficult budget year, we must work in a bipartisan manner to save and create family sustaining jobs – that has to be our first priority,” said Daley. “This re-appointment will allow me to better serve the people of Fayette and Washington counties by being their voice to achieve this important goal.”
Daley noted that the unemployment rates for Washington and Fayette counties remain high and that even though the economy appears to be in a slow recovery, there is “very real pain” among the long-term unemployed, their spouses and children.
“As we begin a new session, an evaluation of the tax burden on business is paramount in my mind, because it is directly tied to profitability; a business can’t be expected to expand and create jobs until it has fully recovered from the recession and there may be ways the commonwealth can speed that healing process” Daley said. “By reducing, and in some cases completely eliminating, certain business taxes, we stand to make gains not only in the employment rate, but all of the other very tangible benefits that are realized when a person is gainfully employed.”
For example, Daley noted, a hard look should be taken at whether or not it makes sense to apply the sales tax to the maintenance and sales of aircraft. Neighboring states have done away with that type of taxation and, he said, that’s a smart idea.
According to Aviation Council of Pennsylvania, m ost of the Fortune 1,000 firms operate aircraft in their business models. In the Fortune 500, there is an average of 2.6 aircraft per firm. But when those high-caliber companies look to locate in Pennsylvania, any kind of financial incentive the state may be able to dangle is quickly dashed when the true cost of locating here is calculated. If, for example, a company owns $150 million in aircraft assets and they didn’t pay sales tax when they took delivery of the aircraft (and most don’t), they are forced to pay Pennsylvania’s 6 percent sales tax. That $9 million bill is enough to send them packing, Daley said. “What is really disturbing about this section of tax policy is that it doesn’t work on either end,” Daley said. “The Pennsylvania sales and use tax on aircraft sales, rental, leasing, parts and supplies is expected to net the state only $4.6 million in Fiscal year 2010-11, according to the Department of Revenue. And this is due in part to how uncompetitive Pennsylvania has become with regard to this sector – we’ve allowed it to wither away by not paying attention to what our neighbors were doing. And these are good-paying jobs, averaging about $50,000 per year.”
During the 2009-10 legislative session, four bills originating in the House Commerce Committee under Daley’s leadership were signed into law.
Those bills included the Pennsylvania Affordability and Rehabilitation Enhancement Program, which was authored by Daley (House Bill 60).
The law will enable the Pennsylvania Housing Finance Agency to build or rehabilitate and preserve housing for low- to moderate-income people, the elderly and those with disabilities.
Pennsylvania now joins 38 other states in providing a trust fund for affordable housing.
The committee also approved an additional 13 bills.