Day: June 14, 2024

Originally published at Pennsylvania Policy Center on June 14, 2024. In our first post in this series, we argued that if the Pennsylvania General Assembly chooses to cut taxes in the budget that begins on July 1st, it should limit the cut to less than $1 billion per year and focus the benefits of the cut on low- and moderate-income Pennsylvanians. There is one plan that meets both of these criteria perfectly: a state earned income tax credit. The federal earned income tax credit (EITC) is a program that puts more money into the pockets of low- and middle-income families by giving them a credit against the taxes they pay. It was a program created by the Nixon administration and expanded under subsequent Republican presidents. It has traditionally been supported by Republicans who believe, correctly, that it encourages and makes it possible for people with low incomes to enter and… Continue reading

Originally published at Pennsylvania Policy Center on June 14, 2024. In response to a Senate vote in favor of a small reduction in the personal income tax rate and the gross receipts tax on electricity, we pointed out that this is not the right time to be reducing taxes in Pennsylvania. At the moment, the state has a substantial budget surplus of more than $13 billion—but we need that surplus for two purposes. First, we are currently using it to pay the state’s operating expenses and will continue to do so because annual expenditures exceed annual revenues by more than $3 billion. Second, the state has serious needs that require additional investment. To start with, we will eventually need an additional $6–$7 billion per year to meet the constitutional and moral responsibility to adequately and equitably fund K–12 education. And then there are critical needs in both pre-K and higher… Continue reading