1. Rep. John Knotwell Herriman, Riverton, South Jordan

2.  Alternate corporate income tax apportionment strategy (not a tax cut)  Triple weight system: Percentage of nationwide property, sales and payroll (located in a state) is taxed equally (33.3% each)  Double weight system: Double weight in sales (50%) and equal weight to the remaining two factors (payroll and property)  Single Sales Factor: 100% corporate income tax based on percentage of sales in the state.  Single Sales Factor benefits companies with majority payroll and property in Utah while shipping majority products out of state  Single Sales Factor will not benefit companies with majority payroll and property in Utah and shipping most products within Utah.

3.  WORLDWIDE Economy  Utah is competing with China, India, eastern Europe, Latin America, etc.  Other States  Utah is competing with states with much larger budgets to offer larger incentives  Capital Investment  Capital investment follows the path of least resistance. It only goes where it is wanted.  Capital brings stickiness to its benefactor (Utah).  Once the first state did it, it is inevitable in some parts of our economy  Already used in Utah  We have history in our state of its effectiveness

4.  Initial approach: All tax filers = $138M immediate impact to education budget  Substitute  Add an additional industry classification to the existing SSF code  Approximately 300 companies could qualify  Electable  Dynamic Fiscal Impact  Roughly 2 years, +$24M to Education Fund, +$16M to General Fund, $1-$4 Billion in capital investment into our economy  Industry Classification  High Tech Manufacturing  High Paying Jobs  Immediate impacts to our state and local economy  Proven success

5.  Evaluate the current system – is it working?  Electable or Mandated  More industry classifications