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Why Pennsylvania?

A Business Climate Built for Action

Governor Josh Shapiro, surrounded by a group of government officials and business leaders, smiles and shows an exectutive order document for the just-announced Permit Fast Track program. The Philadelphia skyline and construction equipment are visible in the distance.

Boosting business success through collaborative, smart policy.

Pennsylvania’s diverse regions and vibrant economy — ranked the 26th largest in the world — make it a launchpad for businesses across sectors. From robotics and life sciences research centers to thriving hubs of manufacturing and agriculture, Pennsylvania offers prime locations across the state for your business to grow and succeed​​. Whether you need seamless port access or a deeply skilled workforce, our business climate provides stability and room for expansion.

We’re not just good for business, we’re ready for action. Pennsylvania has a clear 10-year economic development strategy, with significant investments in infrastructure, workforce training, and site development. Through programs like PA SITES, we are fast-tracking projects to make more industrial and commercial sites shovel-ready — so your business can hit the ground running.

 

Lower rates and fewer barriers give companies an edge.

 

Here in Pennsylvania, we’re taking bold steps to boost our tax competitiveness. Cutting the corporate net income tax rate to 4.99% by 2031 is just the tip of the iceberg. Learn why the Keystone State is among the most attractive states to do business

  • Reduced Corporate Net Income Tax (CNIT) Rate
    • Decreasing 0.5% annually from 7.99% in 2025 to 4.99% in 2031, Pennsylvania’s corporate net income tax rate is becoming one of the most competitive regionally and nationally. Once fully phased down, the rate will be lower than all of our neighboring states that have CNITs, where rates currently range from 6.5% (West Virginia) all the way up to 11.5% (New Jersey).
  • Personal Income Tax (PIT) Rate: 3.07%
    • With a flat 3.07% tax that applies to partnerships, LLCs, and S corporations, Pennsylvania is prime for small and medium-sized businesses that operate as pass-through entities. Of states with a PIT, only two states — Arizona (2.5%) and North Dakota (2.9%) — have lower rates.
  • Tangible Personal Property Tax: 0%
    • Pennsylvania does not tax machinery, equipment, or inventories — a tax imposed in 27 other states. This removes barriers to capital investment and makes business expansion more cost-effective.
  • Increasing Allowable NOL Deductions
    • The state is increasing allowable Net Operating Loss (NOL) deductions by 10% annually — from 40% in 2025 up to the federal limit of 80% in 2029. This change supports innovation in start-up, technology, and life sciences businesses.
  • Broad Sales and Use Tax Exemptions for Manufacturing and R&D
    • Pennsylvania offers broad exemptions for manufacturing and R&D-related purchases, reducing acquisition costs and supporting business upgrades.
 We’ve really benefited from having this ecosystem of not only all the wonderful people to be able to hire out of the universities, but also an ecosystem of venture funding and the ability to fuel the growth of these companies. To have a very responsive government — that’s incredibly helpful.”

 

— Gavin Kenneally, CEO of Ghost Robotics (Philadelphia)

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