Death and Taxes

Governor Wolf earlier this month presented his budget for fiscal year 2015-2016. It was actually one of the more interesting budgets of the past 30 years. Not because it advocated for tax increases and acknowledged a state revenue deficit of over 2.5 billion dollars.

No, this was not just a budget address but almost a complete overhaul of both state government and the tax code. It was a political manifesto as it was a budget.

For decades there have been complaints about the property tax and its inequities. There have been countless solutions, from money from legalized gambling to Allegheny County’s RAD tax—none have stopped the inevitable rise in millage rates. Governor Wolf’s solution is a rate increase and broadening of the base of the state sales tax, with the majority of the additional dollars collected going to local school districts with a mandate to reduce property taxes.

The corporate community has long complained about the high taxes on business in Pennsylvania making us non-competitive with other states in attracting or maintaining businesses. Governor Wolf would complete the long hoped for demise of the Capital Stock and Franchise Tax and also cut the Corporate Net Income rate in half in just two years. He would fund these cuts with the demise of the Delaware Loop hole.

Governor Wolf would use an excise tax on natural gas extraction to increase funding for education and raise the Personal Income Tax to fill the deficit. Plus there would be a tax on cigars and smokeless tobacco to round out the tax smorgasbord.

Reaction from the Republican controlled General Assembly was of course, predictable.

Now whether we will see any or all of these proposed taxes come the end of June when the Pennsylvania Constitution mandates a budget be in place remains to be seen.

There is a deserved skepticism on state mandated property tax reductions, local municipalities, counties and school districts are ultimately responsible for the levying and spending of property taxes. The business tax cuts and closing of loopholes currently has the business community divided between the larger corporations and their S-Corp brethren.

Republican options include selling off the liquor stores and using the money to bridge the revenue gap; fixing the state employee’s pension fund deficits to reduce the cost of the Commonwealth’s contributions into that fund. Or just cutting the state budget even further than the recently unelected Governor Corbett was not willing to do.

Just recently the Independent Fiscal Office proclaimed that our revenue deficit was only 1.8 billion. Regardless, Pennsylvania is not the Federal Government, our beloved Commonwealth is required by law to have a balanced budget.

So whether Governor is successful in the broad sweeping changes his budget calls for or whether the General Assembly is successful in stopping him one thing is ultimately clear.

Taxes will go up. Don’t know which ones or how much. Taxes will go up.

by Nello Giorgetti

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If you have questions please contact Michelle Vezzani at or the public affairs professional with whom you work.

New Legislation Introduced – August 2014


  • Rep. Mustio (R-Allegheny County) sponsored a bill that would require transportation network companies, such as Uber and Lyft, to be licensed by the Public Utility Commission (PUC) and to meet certain insurance and safety requirements.  (House Bill 2453).  Rep. DeLuca (D-Allegheny County) sponsored a similar bill.  (House Bill 2446).
  • Rep. Killion (R-Delaware County) sponsored a bill that would place certain limitations on transportation network companies, such as Uber and Lyft, including, but not limited to, a requirement to obtain commercial liability insurance as primary coverage, obtain a certificate of public convenience, and file criminal background checks on the drivers of these companies.  (House Bill 2445).


  • Rep. Metcalfe (R-Butler County) sponsored a bill that would require all employers in the state, including governmental employers, to enroll in the Employment Eligibility Verification Program (E-Verify); it would also allow municipal governments to adopt ordinances denying business licenses to employers of unauthorized aliens.  (House Bill 2430).

Municipal (Vacant & Blighted Property)

  • Rep. Day (R-Berks County) will be introducing legislation that would establish the Vacant Property Registration and Assessment Act, which is intended to address problems associated with vacant and blighted property by shifting the responsibility of helping to solve those problems on owners of properties that are vacant and/or blighted.


  • Rep. Thomas (D-Philadelphia County) will be introducing legislation calling upon the Legislative Budget and Finance Committee to conduct a study on transitioning from a flat personal income tax to a graduated personal income tax system.

Economic Development

  • Rep. Benninghoff (R-Centre County) sponsored a bill that would reduce the Redevelopment Assistance Capital Program (RACP) debt ceiling (the outstanding obligations for redevelopment assistance projects) by $50 million increments until the debt ceiling reaches $2.95 billion (on July 1, 2027).  (House Bill 2420).

Rep. Turzai (R-Allegheny County) sponsored a bill that would establish annual spending limits on all project types that come under the Capital Facilities Debt Enabling Act, including redevelopment assistance projects.  (House Bill 2419).


If you have questions about the budget or any introduced legislation, please contact Michelle Vezzani at or the public affairs professional with whom you work.