Young Philly Politics - Taxes en Pennsylvania Among 'Terrible 10' Most Regressive Tax States <p><strong>By Chris Lilienthal, <a href="">Third and State</a></strong></p> <p>Working families in Pennsylvania pay a far higher share of their income in state and local taxes than the state’s wealthiest earners, according to a new study by the Institute on Taxation and Economic Policy (ITEP).</p> <p>Pennsylvania’s tax system scored so poorly that it made the list of the “Terrible 10” most regressive tax states in the nation.</p> <p>The Pennsylvania Budget and Policy Center (PBPC) co-released the report, <a href="" target="_blank"><em>Who Pays? A Distributional Analysis of the Tax Systems in All 50 States</em></a>, with ITEP. PBPC Director Sharon Ward made the point in a <a href="" target="_blank">press release</a> that "No one would deliberately design a tax system where low-income working families pay the greatest share of their income in taxes, but that is exactly the type of upside-down tax system we have in Pennsylvania.”</p> <p>Middle-income families in Pennsylvania pay more than double the share of their income in taxes than the very wealthiest Pennsylvanians, while low-income families pay nearly three times as much as top earners, the report found. Get more details on the report, including a Pennsylvania fact sheet, <a href="">here</a>.</p> <p><a title="Click for a larger view" href=""><img src="" alt="PA State &amp; Local Taxes: Shares of family income for non-elderly taxpayers" width="525" /></a></p> <p>The report should bury once and for all the myth of the makers vs. the takers. Low-income families in Pennsylvania are paying much more of their income in state and local taxes than the top 1%.</p> <p><a href="">read more</a></p> Low-income Families middle class Pennsylvania Regressive Taxes Tax Equity Taxes Fri, 01 Feb 2013 17:47:00 +0000 8568 at PA Revenue Strong Midway Through Year; Tax Cut Could Have Big Impact <p><strong>By Michael Wood, <a href="">Third and State</a></strong></p> <p>With a strong December showing, the commonwealth now has a <a href="" target="_blank">General Fund revenue surplus</a> of $171 million (1.4% above estimate) for the first half of the 2012-13 fiscal year,&nbsp;double the Corbett administration’s revised estimate for the entire fiscal year.&nbsp;The strong December collections exceeded&nbsp;estimate by $112 million (or 4.8%).</p> <p>The increased revenue is a good sign of a modestly recovering national economy and a brightening of the state’s fiscal picture going into the 2013-14 budget season. This is a nice change from previous years when midyear shortfalls triggered cuts to state services.</p> <p>In December, personal income, corporate, and realty transfer taxes exceeded revenue targets by 10.1%, with sales, inheritance and other taxes (on cigarettes, alcohol, and table games) falling short of expectations by 2.8%. &nbsp;</p> <p>A similar picture exists over the first half of 2012-13 — corporate, personal income and realty transfer tax collections are a combined 5% higher than expected, while sales, inheritance, and other taxes have fallen 2.4% short of budget estimates.</p> <p>One area of concern is that sales tax collections (the state’s second largest tax source) are $125 million, or 2.7%, lower than projected. It is not clear the reason for this as vehicle sales and consumer spending have been increasing. Perhaps the new tax collections from some online retailers may not be as large as anticipated.</p> <p>Compared to last year, collections are $583 million, or 5%, higher, with corporate ($254 million) and personal income tax ($186 million) collections making up most of the increase in 2012-13.</p> <p><a href="">read more</a></p> budgets Pennsylvania Taxes Mon, 07 Jan 2013 14:51:36 +0000 8560 at What to Make of the Fiscal Cliff Deal? <p><strong>By Sharon Ward, <a href="">Third and State</a></strong></p> <p><em>Tell us what you think about the Fiscal Cliff deal.</em> <a href="" target="_blank"><em>Take our two-question survey.</em></a></p> <p>The agreement reached by President Obama and Congress on January 1 was both historic and disappointing&nbsp;—&nbsp;and it leaves much unsettled. The urgency of the Fiscal Cliff has dissipated, but significant threats remain to federal funding for state and local services as well as refundable tax credits for low-income working families, Medicaid, Medicare and Social Security.</p> <p>There is much to dislike in this agreement. It makes permanent most of the Bush era tax cuts, ensuring that income from dividends and capital gains will be taxed at a lower rate than income from work. It makes permanent the estate tax but locks in a tax rate that creates a huge windfall for the top 0.3% of households.&nbsp;Sequestration cuts — the automatic spending cuts that members of both parties hated and the President said would not occur — have been postponed for two months, with three-quarters of FFY 2013 cuts ($85.6 billion) and $109 billion in annual cuts after that still in law through 2022.&nbsp;The President’s line in the sand on raising tax rates for the top 2% of earners got pushed way back, with top rates kicking in at $400,000 for an individual and $450,000 for a couple. A low-wage earner might need 20 years to make that much.</p> <p><a href="">read more</a></p> Federal Budget fiscal cliff Pennsylvania Tax Cuts Taxes Thu, 03 Jan 2013 21:06:37 +0000 8559 at Pennsylvania Tax Giveaways and an Island in the Sun <p><strong>By Jamar Thrasher, <a href="">Third and State</a></strong></p> <p>A few weeks ago, the Pennsylvania General Assembly fast-tracked <a href="" target="_blank">a bill</a> in the waning days of the legislative session to allow certain private companies to keep most of the state income taxes&nbsp;of new employees. News reports to follow indicated the new tax giveaway was designed to lure California-based software firm Oracle to State College.</p> <p>Well, it turns out the CEO of Oracle, which will benefit from the largess of Pennsylvania taxpayers, recently bought his very own Hawaiian island, as CNN <a href="" target="_blank">reported</a> back in June.</p> <p>Oracle CEO Larry Ellison, the third richest man in the U.S., purchased about 98% of Lana'i, the sixth largest of the Hawaiian islands. Forbes <a href="" target="_blank">reported</a> that the deal was rumored to be worth $500 million.</p> <p>As CNN tells us:</p> <blockquote><p>The island includes two luxury resorts, two golf courses, two club houses and 88,000 acres of land, according to a document filed with the Public Utilities Commission.</p> </blockquote> <p>Which bring us back to Pennsylvania, where Governor Corbett recently signed House Bill 2626, allowing qualifying companies that create at least 250 new jobs within five years to pocket 95% of the personal income taxes paid by the&nbsp;new employees.&nbsp;</p> <p><a href="">read more</a></p> corporate welfare economic development Income Inequality Pennsylvania Pennsylvania Budget State Budgets Tax Giveaways Taxes Thu, 08 Nov 2012 16:02:31 +0000 8546 at A Rare Victory In The Endless Fight Against Corporate Welfare <p><strong>By Mark Price, <a href="">Third and State</a></strong></p> <p>In a rare victory against corporate welfare in Pennsylvania, Ahold USA has withdrawn its request for property tax breaks for a meat-packaging facility it is building in Lower Allen Township, Cumberland County.</p> <ul> <li>Jim Ryan, <em>Central Penn Business Journal</em> — <a href="" target="_blank">Ahold drops LERTA request for meat-packaging plant</a></li> <li>Monica Von Dobeneck, <em>The Patriot-News</em>&nbsp;—&nbsp;<a href="" target="_blank">Giant Foods owner withdraws request for tax break for its meat repackaging plant in Lower Allen Township</a></li> </ul> <p>As Michael Wood <a href="" target="_blank">explained</a> before the request was withdrawn:</p> <p><a href="">read more</a></p> corporate welfare economic development Pennsylvania Pennsylvania Budget Tax Giveaways Tax Incentives Taxes Thu, 18 Oct 2012 20:53:53 +0000 8540 at Pennsylvania Hunger Games Diet: Cash for Corporations, Cuts for Kids <p><a title="Click for larger version" href=""><img style="float: right; margin-left: 10px;" src="" alt="" width="325" height="243" /></a></p> <p><strong>By Mark Price, <a href="">Third and State</a></strong></p> <p>On Tuesday Marty Moss-Coane, the host of WHYY's Radio Times, moderated a question-and-answer session with Governor Tom Corbett at an event sponsored by the Greater Philadelphia Chamber of Commerce. The Governor ran wild with analogies.</p> <ul> <li>Bob Fernandez, <em>The Philadelphia Inquirer</em> — <a href="" target="_blank">With protesters nearby, Corbett sticks to message for Phila. Chamber</a>:</li> </ul> <blockquote><p>Corbett repeated a folksy analogy to the business suit-and-tie audience, saying that state revenue amounted to an eight-inch pizza pie before the 2008 financial crisis. Now, he said, it’s a six-inch pie “but with the same mouths to feed.”</p> </blockquote> <ul> <li>Chris Brennan, <em>Philadelphia Daily News</em> — <a href="" target="_blank">Corbett: Open to spending more, but not protesters</a>:</li> </ul> <blockquote><p>Moss-Coane noted near the end of the hour-long conversation that Corbett could hear demonstrators beating drums and chanting slogans outside. What would he say to them, she asked.<br /><br />“I understand that you’re upset because we’ve had to put the state on a diet, for want of a better description,” Corbett said. “I haven’t met anybody who likes to go on diets. It is not easy. It is not what we want to do.”</p> </blockquote><p><a href="">read more</a></p> economy Education Kindergarten Pennsylvania Pennsylvania Budget State Budgets Taxes Tom Corbett Wed, 16 May 2012 21:15:14 +0000 8394 at Multi-tasking with the 1% … killing the schools AND making the poor pay for their funeral. <p>I showed <a href=" ">here</a> how we could raise $94 million for the School District from the property tax, as requested by the Mayor, and sequester it until the SRC abandons its privatization plan. But is the property tax the best place to get the money? If the City raised the $94 million from some other source, it could still sequester it until the SRC sees the light.</p> <p>The 1% generally likes the property tax. It’s a regressive tax that falls most heavily on people who are property-rich, cash poor. How sweet it would be to make poor and working people not only pay more, but to make them pay more for destruction of one of their greatest assets, the public school system.</p> <p>There has been dispute, however, whether a property tax increase as it’s been packaged this year would indeed hit poor people the hardest.</p> <p>Some progressives think that a property tax increase this year would not be regressive because it would emerge out of the AVI initiative intended to correct the massive inequities in City property assessments. But even if assessments were accurate, and didn’t under-value richer neighborhoods, poor property owners would still get hit hardest from tax rate increases. It’s just the nature of the property tax. It taxes at a single rate that the rich can pay much easier than the poor.</p> <p>AVI, if done right, is a good thing. Increasing rates, however, to generate more revenue from the tax, might still not be. </p> <p><a href="">read more</a></p> City Council gentrification relief SRC Taxes Thu, 10 May 2012 21:37:47 +0000 Stan Shapiro 8391 at Let the Games Begin: PA Senate Announces Details of Budget Proposal <p><img style="float: right; margin-left: 10px;" src="" alt="" width="200" height="135" /></p> <p><strong>By Sharon Ward, <a href="">Third and State</a></strong></p> <p>Action on the state budget began in earnest Monday with state Senator Jake Corman, chairman of the Appropriations Committee, releasing important details on the Senate budget plan that will be advanced this week.<br /><br />The proposal would increase Governor Tom Corbett's budget proposal by $500 million, with total spending rising from $27.15 billion to $27.65 billion for 2012-13. The Senate plan rejects $191 million in fund transfers and new revenue and proposes new spending cuts of $165 million. Those spending reductions were not yet detailed.</p> <p>According to a <a href="" target="_blank"> report</a>&nbsp;(subscription required), the Senate budget plan:</p> <p><a href="">read more</a></p> Education health care Higher Education Pennsylvania Pennsylvania Budget Public Welfare State Budgets Taxes Tue, 08 May 2012 16:37:41 +0000 8388 at Good News on PA Revenue But Don’t Count Your Blessings Just Yet <p><strong>By Sharon Ward, <a href="">Third and State</a></strong></p> <p>Pennsylvania’s Independent Fiscal Office (IFO) released its <a href="" target="_blank">revenue estimate</a> this week, offering a more upbeat view of the economy moving forward. The official revenue estimate predicts a smaller revenue shortfall for the current year and more robust revenue collections for 2012-13.</p> <p>The IFO estimate leaves the General Assembly with as much as $800 million available to restore cuts proposed by the Governor. This is clearly good news, but both the Corbett administration and legislative leaders are already dampening expectations about the scale of funding restorations.</p> <p><strong>A Look at the Numbers</strong>&nbsp;</p> <p>In the current 2011-12 fiscal year, the Corbett budget pegged revenue at $27.1 billion, with a revenue shortfall of $719 million. The IFO estimates revenue collections will be $419 million higher, at $27.5 billion and a shortfall of $300 million for the fiscal year. With $700 million in current-year reserves, this leaves an actual year-end surplus of around $400 million.</p> <p>In the 2012-13 fiscal year, the IFO predicts revenue at $28.7 billion. This is approximately $404 million higher than the Corbett budget (the IFO excludes $142 million in new revenue sources proposed by the Governor in his budget plan, since those measures have not yet been enacted). <a href="" target="_blank">See a table with more details.</a></p> <p><a href="">read more</a></p> economy Pennsylvania Pennsylvania Budget State Budgets Taxes Fri, 04 May 2012 16:08:13 +0000 8386 at PA Revenue Picture Brightens <p><strong>By Michael Wood, PA Budget and Policy Center</strong></p> <p>Pennsylvania tax collections came in better than expected in March, lowering the state's total revenue shortfall for the current fiscal year. It was also the first March ever in which tax collections exceeded the $4 billion mark.&nbsp;</p> <p>With three months left in the 2011-12 fiscal year, the revenue shortfall stands at $387 million, much lower than the year-end revenue shortfall of $719 million estimated by the Corbett administration and built into his 2012-13 budget.</p> <p><img style="border: 1px solid black;" src="" alt="General Fund Revenue Shortfall" width="471" height="377" /></p> <p>This should be welcome news as lawmakers move closer to negotiating a 2012-13 state budget. Improved collections may signal a less severe year-end shortfall, and that could help reduce some of the painful cuts proposed in the Governor's budget. Get the Pennsylvania Budget and Policy Center's full <a href="" target="_blank">revenue analysis here</a>.</p> <p>March is an important revenue month for a number of reasons. For one, almost half of corporate tax collections for the year were collected last month. And corporate taxes exceeded monthly estimates by $106 million, or nearly 5%, last month. This played a big role in creating a March revenue surplus of $95 million.</p> <p>After the strong March collections, every major tax type now exceeds year-to-date tax collections this time last year. Taxes are now $583 million higher than they were at the end of March 2011 — a sign of the improving economy.</p> <p><a href="">read more</a></p> Pennsylvania Pennsylvania Budget State Budgets Taxes Mon, 09 Apr 2012 17:16:28 +0000 pennbpc 8364 at