Month: December 2016

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The Fair Share Tax to Support Public Investment in Pennsylvania

  By Fair Share Tax, PA Budget and Policy Center, Policy reports, Taxation

This paper puts forward a plan, which we call the Fair Share Tax, that would take a major step toward fixing Pennsylvania’s broken tax system and raise the revenues we need to invest in the public goods that are critical to creating thriving communities and individual opportunity in our state: education, infrastructure, protection for our air and water, and human services. Click here to print or read full screen. Continue reading

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Combine spending restraint with new revenue

  By PA Budget and Policy Center, Pennsylvania Budget, Pennsylvania State Taxes, Published Op-Eds, Taxation

This piece originally appeared in the Erie Times-News, December 28, 2016. Pennsylvania has been struggling with persistent budget deficits since the start of the Great Recession in 2008. And we at the Pennsylvania Budget and Policy Center have been recommending a “balanced approach” to resolving the deficit from the beginning, one that combines restraint in spending with new revenues. But since 2010, under Govs. Tom Corbett and Tom Wolf, the General Assembly has adopted an unbalanced approach. Spending has gone down but revenues have gone down faster. From 1994 to 2011, under both Democratic and Republican governors, the state spent 4.7 percent of the state’s gross domestic product. During the Corbett years that fell to 4.3 percent as spending on education and human services were sharply cut. And while, thanks to Wolf, the state has been able to restore some of those cuts, spending in the last two years remains… Continue reading

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Limitations on the State and Local Tax Deduction Hurt Pennsylvania in Two Ways

  By Federal Taxes, PA Budget and Policy Center, PBPC Blog posts, Resisting Trump, Taxation, US

A major issue in the debate over the Republican tax cut bill is whether the deduction for state and local taxes (the SALT deduction) should be eliminated or reduced. The conference committee bill released on Friday proposes a “compromise” that would allow individuals to deduct up to $10,000 in some combination of state and local property and income or sales taxes. That compromise is deeply problematic for Pennsylvania and many Pennsylvanians, in two different ways. First, substantial numbers of upper middle-class Pennsylvanians will see their taxes go up as a result of the limitation on state and local tax deductions in the conference committee bill. These taxpayers are likely to be concentrated in the suburbs of Philadelphia, where a high percentage of taxpayers take the state and local deduction. Second, the state as a whole will suffer because the limitation on the state and local tax deduction will make it… Continue reading

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On The Mid-Year Budget Briefing: The Full Picture Is Even More Grim

  By Budget, PA Budget and Policy Center, PBPC Blog posts, Pennsylvania Budget

Budget Secretary Randy Albright’s mid-year budget briefing this week brings worrisome news that, at its current level of expenditure and revenues, the Pennsylvania budget for the 2016-17 will have a deficit of $600 million. Part of that deficit is the result of lower tax revenues than were projected when the budget was enacted in July. Another part is higher human service caseloads, which will require a supplemental appropriation.   The projected deficit might increase again if the General Assembly does not enact legislation to bring in $100 million in internet gaming revenues and if a second Philadelphia casino license is not sold for $50 million. While the current year deficit is a problem for the state, unfortunately it is not the biggest budget problem we face. The Independent Fiscal Office is projecting a 2017-18 deficit of $1.7 billion, which does not include the ongoing costs of higher human service caseloads… Continue reading