It makes no sense that Pennsylvania sits back and watches big companies do business here but shield themselves from paying their fair share of taxes to our state.
While they enjoy all the benefits of the commonwealth - using our roads, water and other infrastructure, some even getting government financial breaks - they are not sharing the financial load with the rest of us.
Instead these multistate corporations use a corporate shell game by shifting income to tax havens elsewhere to avoid paying state corporate net income taxes. One of the most popular spots to go to is Delaware.
It is a problem and huge drain on state revenue that should go into Pennsylvania's coffers. It has been that way for years. Democrats have called to close what is known as the Delaware loophole but have been rebuffed by Republicans who have traditionally said they were hesitant to do something that could be seen as negatively impacting the state's business climate.
Until now - maybe.
Recently, House Republican leaders, who are in the majority, introduced legislation that would close the loophole.
The measure would give the state Department of Revenue the ability to stop these large firms from moving profits out of Pennsylvania to lower-tax jurisdictions and avoid paying the state's 9.99 percent corporate net income tax.
To try and soften the blow for businesses and get support from business associations, the bill also calls for lowering business taxes, including gradually reducing the corporate net income tax rate to 6.99 percent by 2019.
Closing the loophole makes sense and lawmakers should move quickly to do so.
Already 23 states have passed similar legislation to address this problem, including our neighbors Maryland, Ohio, New York, New Jersey and West Virginia. Many require that corporations and affiliated shell companies file together and pay taxes according to the amount of business activity done within their state borders.
Unfortunately, it is no sure bet legislators will come to an agreement on the particulars of the bill or if the governor will support it.
He has focused his attention on scaling back part of a $73 million incentive that retailers have gotten for decades if they collect sales tax and send it to the state before the deadline. This also is an idea worth exploring but should not preclude the governor's support for ending the Delaware loophole this year.
But when asked about the loophole idea during appropriations committee hearings recently, state Revenue Secretary Dan Meuser didn't endorse the bill. While he did call it "a very smartly planned idea," he also suggested the governor won't support a "short-term answer that sounds good."
That so many other states have done something similar makes it clear they don't see it as a short-term solution and neither should the governor.
The bill does not need to be sugar-coated with tax cuts, including to the corporate net income tax. If any other reason is needed to push ahead on closing the loophole, the numbers speak for themselves: the Revenue Department previously estimated that the state could see an additional $612 million in revenue by closing the gap.
This is a difficult time for Pennsylvania. Elected officials once again face a tough budget and prospects of slashing programs and cutting funding from important areas such as welfare and education.
Given the bleak financial outlook, we can no longer give these corporations a free pass - literally at our expense.
-The (Harrisburg) Patriot-News