On Tuesday March 3rd, Governor Tom Wolf released his $30 billion state budget proposal which is balanced using $4.2 billion in new revenue sources including an increase in the Personal Income, Sales Taxes as well as a severance tax on natural gas. Fort the gas industry, the Governor proposes the same tax rate as West Virginia: 5 percent on the value of the gas extracted plus 4.7 cents per thousand cubic feet of gas extracted.
“We all know the challenges Pennsylvania faces. We are staring at a $2.3 billion budget deficit, we are near the bottom of the country in job growth, our state’s credit ratings have been in decline, and our schools are struggling. These are bipartisan challenges and they require bipartisan solutions. My budget incorporates many Republican and Democratic ideas to move Pennsylvania forward,” state Governor Wolf.
Of great interest and excitement to the Chamber is the Governor proposal to make the Commonwealth’s corporate tax climate competitive by continuing the elimination of the capital stock and franchise tax (CFST), and reducing corporate net income tax to 5.99 percent beginning January 2016 and will be further reduced to 4.99 percent beginning January 2018 if combined reporting is implemented and revenue benefits realized..
In his post budget address comments to the PA Legislative Services News Bureau, Rep. Bill Adolph (R- Delaware), chairman of the House Appropriations Committee, explained when he first saw the governor’s budget proposal, all he could think was “wow, an incredible amount of taxes.” Rep. Adolph stated the governor’s plan to increase the personal income tax from 3.07 percent to 3.7 percent means a 16 percent tax increase on the middle class. He said the ten percent increase in sales tax to 6.6 percent and the expanded taxable products may entice people to shop in the state of Delaware, instead of the southeast region of the state.
As the budget process unfolds, the Greater West Chester Chamber of Commerce is committed to continued work with the Governor and our Legislative Delegation to support pro-business policies which will go a long way towards making our area and state a better place to live, work, and raise a family.