{"id":7683,"date":"2016-07-02T18:32:51","date_gmt":"2016-07-02T22:32:51","guid":{"rendered":"http:\/\/marcstier.com\/blog2\/?p=7683"},"modified":"2016-10-14T02:30:05","modified_gmt":"2016-10-14T06:30:05","slug":"how-pennsylvania-should-not-raise-revenues-this-year","status":"publish","type":"post","link":"https:\/\/marcstier.com\/blog2\/?p=7683","title":{"rendered":"How Pennsylvania Should Not Raise Revenues This Year"},"content":{"rendered":"

\"19349987-mmmain\"<\/a><\/p>\n

In my last post<\/a>, I suggested three criteria any proposal to raise revenues in Pennsylvania should meet:<\/p>\n

    \n
  1. The new revenue source needs to be real rather than a fantasy generated by wishful thinking.<\/li>\n
  2. The new revenue source needs to be recurring rather than a one-year bridge.<\/li>\n
  3. The new revenue should not increase the inequity of our tax system, which is among the ten most inequitable state tax systems in the country, by placing most of the burden on low- and middle-income people.<\/li>\n<\/ol>\n

    And I pointed out that our proposal to slightly raise the tax on income from wealth, which would bring in $778 billion mostly from the top 5% of households by income in Pennsylvania, meets all three criteria.<\/p>\n

    Unfortunately, the proposals that actually seem under consideration by the General Assembly barely meet any of these three.<\/p>\n

    Liquor<\/b>: Some of the projected revenue from the creation of new outlets for the sale of beer and wine may not be real. The House Republicans are claiming that there will be $150 million in new revenue from the PLCB. But the Independent Fiscal Offices says the state will receive only about $100 million. And they will mostly be one-time revenue from the sale of licenses. No one really knows whether the new outlets will lead to additional sales of wine and beer or whether they will just cannibalize sales at Wine and Spirit Stores and beer distributors. And those recurring revenues are regressive, taking a larger share of the income of low- and middle-income households than high-income ones.<\/p>\n

    Gaming<\/b>: Projected additional gaming revenue of $200 million to $300 million are, like the promise of beating the house, partly a product of fantasy. The House Republicans expect, once again, that the state will realize $50 million from the sale of a second Philadelphia casino license. It is not at all clear that this will happen in 2016-17, if at all. Much of the rest of the expected new revenue comes from the sale of licenses for online gaming. No one really knows how much interest there will be in online gaming. We should remember that the expansion of tavern gaming in 2015 was supposed to bring $94 million in sales of license and additional revenues. The state saw new revenue of only $1.6 million in the first two years. None of the revenue that comes from the sale of licenses is recurring. And whatever ongoing revenue is raised is regressive, taking a larger share of the income of low- and middle-income households than high-income ones.<\/p>\n

    Tax Amnesty<\/b>: Some in the Capitol claim that tax amnesty will bring in as much as $129 million. Others, pointing out that this new amnesty follows the last one by only a few years, expect only $80 million or less. Either way, tax amnesty revenues are not only non-recurring, but could have the perverse effect of reducing tax revenues in future years as individuals and businesses decide to put off tax payments while waiting for the next amnesty. And that, of course, also shows how unfair the tax amnesty program is. Giving scofflaws a break on what they owe the Commonwealth is not fair to those who pay their taxes regularly. And, since most of those who take advantage of the tax amnesty have higher incomes, it is a doubly regressive way to raise revenue.<\/p>\n

    Tobacco<\/b>: Projected new revenue of $400 to $600 million from taxes on tobacco and related products, such as vaping, may well be real, at least in the short term. But as tobacco consumption declines, due in part to the new taxes, revenues will decline as well. And tobacco taxes are also doubly regressive. They not only take a higher share of income from low- and middle-income households, but people in these households are more likely to consume tobacco products. While it makes some sense to discourage them from doing so, at some point it is not fair to place so much of the burden of paying for state spending on these households.<\/p>\n

    Instead of these possibly fantastic, mostly one-time, and almost wholly regressive sources of new revenue, Governor Wolf and the General Assembly should embrace a 4% (or higher) tax on income from wealth. It is a fair, recurring, and real way to raise the revenues to support this and future budgets.<\/p>\n

    READ THE 4% TAX ON INCOME FROM WEALTH PROPOSAL HERE<\/b><\/a>.<\/b><\/p>\n","protected":false},"excerpt":{"rendered":"

    The proposals to raise taxes Pennsylvania legislators are considering this year are, to far too large an extent, not real, not recurring, and not fair. Here’s what’s wrong with the liquor, gaming, tax amnesty, and tobacco revenue ideas. Continue reading<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[56,107,108],"tags":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p35YuU-1ZV","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=\/wp\/v2\/posts\/7683"}],"collection":[{"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7683"}],"version-history":[{"count":3,"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=\/wp\/v2\/posts\/7683\/revisions"}],"predecessor-version":[{"id":7780,"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=\/wp\/v2\/posts\/7683\/revisions\/7780"}],"wp:attachment":[{"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7683"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7683"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/marcstier.com\/blog2\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7683"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}