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A House committee approved legislation last week to prevent businesses from avoiding paying state corporate income taxes and rejected amendments by Democratic lawmakers to broaden the scope of the bill to address other tax fairness issues.

The measure approved by the Finance Committee addresses the so-called Delaware loophole, which allows businesses headquartered in other states to avoid paying the state Corporate Net Income (CNI) Tax on their operations in Pennsylvania. The panel’s Republican majority and several Democratic lawmakers supported the bill.

The committee’s approval positions the bill for a floor vote when lawmakers return to session in May and makes closing the loophole a live issue for state budget negotiations, said Rep. David Reed, R-62, Indiana, the bill’s sponsor.

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