Wednesday, October 14, 2015

Pennsylvania Wolf's $1.8 billion tax increase package is a joke

See that, even Democrat legislators agree with Republicans that Governor Wolf shouldn't be pushing income tax increases.


Pennsylvania budget talks are set to resume Wednesday

Pennsylvania state Capitol (The Patriot-News)
By Charles Thompson |

The next chance to break the state budget impasse is upon us.

One week after the state House of Representatives defeated Gov. Tom Wolf's $1.8 billion tax increase package on a mostly party-line vote, legislative leaders expect to reconvene on-again, off-again state budget talks Wednesday.

Senate Majority Leader Jake Corman, R-Centre County, said he is hopeful that with the House's strong rejection of Wolf's proposed personal income tax increase as a backdrop, the new talks will have a better chance of gaining quick momentum.

"Now that almost everyone has agreed that we're not going to have an across-the-board tax increase," Corman said Tuesday, in a reference to the House vote, "we're a lot closer together than we were.

"We think there's a real chance to have some sort of agreement fairly quickly."

The key words there are "almost everyone."

Corman can be sure about the Republicans who have majority control of both the House and Senate. Last week's 127-73 vote was built on a wall of resistance from the 118 GOP members present, along with nine western Pennsylvania Democrats.

But Wolf went on a Pittsburgh radio station earlier in the day and said he will not "cave" on the issue of higher taxes, which he believes are needed to fix the gap between revenues and expenses and increase state aid to public schools.

"I can't cave on this," Wolf said. "We've got to have our state on a sound financial basis. That's all I want."

House and Senate Democrats, meanwhile, are clearly open to a budget package that doesn't raise state income or sales taxes, though they also stressed Tuesday that they haven't taken the more broad-based taxes off the table.

"We need to get a budget done. However we get there, as long as we have the appropriate levels of recurring revenues," Senate Minority Leader Jay Costa, D-Allegheny County, said about the new round of talks.

"That's what we need so we're not faced in 2016-17 with a multi-billion dollar structural budget deficit. That's our objective."

It was not clear Tuesday evening if the Wolf Administration will be directly participating in Wednesday's talks, or if they will let the legislative leaders speak for them for the moment. 

There are a lot of alternative revenue sources available to budget negotiators short of changing the income or sales tax: the two revenue measures in the state's arsenal that are guaranteed to hit just about everybody.

Among the streams that at least some - if not all - members of both parties are open to discussion on include: reforms to the state's monopoly on liquor sales; further expansion of legalized gambling; the much-discussed tax on gas production from the Marcellus Shale; higher taxes on cigarettes; and a change in the state's bank shares tax.

Pennsylvania's state government has been operating without a state budget since June 30.

As each week goes by, more lawmakers in both parties are starting to feel the pressures from local school districts running out of cash, and temporary suspensions of certain social service programs.

When the last round of direct talks was suspended two weeks ago for failed stopgap financing efforts, the two sides had narrowed their spending differences to about $600 million, with the Wolf Administration at $31.2 billion and GOP leaders at $30.6 billion.


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