The state Senate has given final approval to a bill increasing taxes on corporations, a key part of Gov. John Carney’s plan to balance a budget for the fiscal year starting July 1.
Under the legislation approved Thursday, maximum corporate franchise tax payments paid by many companies incorporated in Delaware will increase from $180,000 to $200,000. The legislation also creates a second-tier tax of $250,000 annually for the largest corporations.
Analysts say the bill will generate an additional $116 million annually in revenue.
Senators also gave final approval to a bill eliminating Delaware’s estate tax, a move Republicans sought in return for supporting the corporate tax increases.
Democrats and Republicans have yet to agree on a mix of spending cuts and other proposed tax increases to nail down a budget.
Lawmakers eye higher taxes on alcohol, tobacco products
Democratic lawmakers are proposing higher taxes on alcohol and tobacco in Delaware as part of the effort to fashion a budget for the fiscal year starting July 1.
One bill introduced Thursday raises the beer tax by two cents a can. The wine tax would increase by about three cents per serving, while taxes on liquor would jump by 15 cents per 750 milliliter bottle. The increases would net an estimated $7.2 million next year and $9.9 million the following year.
A separate bill increases a variety of tobacco taxes, including hiking cigarette taxes by 50 cents per pack, from $1.60 to $2.10. It also includes vapor products in the definition of tobacco.
Those increases are expected to generate about $11.6 million next year and $17.1 million the following year.
House approves auto insurance reform measure
The state House has approved legislation restricting the factors that insurers can use in setting automobile insurance rates.
The bill, a watered-down version of legislation that had stalled in committee amid opposition from industry groups, was approved Thursday on a 24-14 vote. It now goes to the Senate.
The original bill prohibited the use of age, marital status, credit scores and income in setting auto insurance premiums. Instead, insurers would have to set rates based on a driver’s claims experience, safety record, number of miles driven annually, and years of driving experience.
The revised measure establishes permissible uses of credit information in setting rates. It also prohibits companies from increasing rates simply because a customer is 75 or older or because a spouse’s death causes a change in marital status.