OUR THOUGHTS ON:

PA House Passes Budget

State and Local Tax

By Matthew Dodge

On September 13, 2017, Pennsylvania’s House of Representatives passed its revenue plan of $2.2 billion to balance the state’s budget.  The vote was 103-91, with all yes votes from Republicans, and the no votes were comprised of all Democrats and 15 Republicans. 

The House is framing the passage of its revenue plan as a proposal for negotiations on the revenue shortfall.  Dave Reed, House Majority Leader, reiterated the majority’s desire to balance the budget without increasing taxes on businesses or households.  The House’s plan does not include any new taxes, such as the Marcellus Shale tax on drillers, which is part of the Senate’s plan that includes $570 million in new taxes.  The Senate’s plan, passed in July, also includes increases in the personal income tax and taxes on household utilities. 

The additional revenue in the House’s plan comes from expanded gaming (details unknown), transfers from special funds and up to $1 billion in borrowing from the Commonwealth’s tobacco settlement.  Democrats, including Governor Tom Wolf, reacted to the plan with doubt and noted that the House’s plan falls short on recurring revenue.  Both sides expressed a desire to return to the table and balance the state’s budget.  Check our website for updates as the budget process unfolds this fall.

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