Pennsylvania Governor Calls For 16 Percent Increase On State Income Tax

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Juliegrace Brufke Capitol Hill Reporter
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Pennsylvania Gov. Tom Wolf released his budget plan Tuesday which calls for steep tax hikes in an attempt to balance the budget without major spending cuts.

The Democrat’s proposal includes a 16 percent increase in the state income tax, changing the rate from 3.07 percent to 3.57 percent, which the governor says would not impact seniors since it doesn’t affect retirement income.

The plan also would introduce a 3.5 percent plus a 4.7 cent per thousand feet severance tax, racking up the price for companies to drill for natural gas. Leaseholders will be held accountable for a minimum of 12.5 percent in royalties.

The administration says, if passed, the plan would raise $1.4 billion in the current fiscal year and an additional $2.4 by the time the 2017 fiscal year is completed.

In addition to closing the $1.2 billion structural deficit in the Keystone state, it would allocate $400 million in funds toward the education system.

While rates will go up for most, 426,000 families earning between $36,000 and $55,000 a year will see their income tax eliminated. A total of 247,258 seniors and disabled households would no longer pay property taxes.

“Despite the fact that the majority of hard-working Pennsylvanians cannot afford Gov. Wolf’s massive tax and spending plans, he continues to push for them,” Pennsylvania Senate President Pro Tempore Joe Scarnati said in a statement. “Not once – but twice now – the General Assembly has met our constitutional obligation to pass a balanced budget, yet Gov. Wolf refused to sign them because they didn’t include his billions of dollars of tax increases.”

The governor has scaled back on some plans to raise revenue, initially Wolf planned on upping the sales tax from 6 percent to 6.6 percent, the Philadelphia Inquirer reports.

State lawmakers are set to vote on the measure Wednesday.

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Juliegrace Brufke