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Thursday, January 17, 2008

PA House Passes Tax Cuts

With a unanimous 197-0 vote, the Pennsylvania House Passed HB 377 which would:

  • Roll back the Personal Income Tax rate to 2.80% over two years
  • Reduce the Corporate Net Income Tax rate to 6.90% over several years
  • Uncap the net operating loss and use a single sales factor in caclulating the CNIT
  • Phasing out the state Inheritance Tax over several years
  • Repleaing the Gross Receipts Tax on cell phones and other telecommunications services
  • Enact an Earned Income Tax Credit (EIC, since PA already has an EITC) for low income families.
  • Enact a tax credit for small businesses offering Health Savings Accounts to employees.

These cuts would total over $2 billion when fully phased in.

Read the AP analysis, news releases from the House Republicans, the House Democrats, and CompetePA.

We are glad to see Democrats and Republicans agree that tax cuts are critical to stimulating PA's economy. I have to assume that our testimony on reducing taxes persuaded skeptical lawmakers who have decided to trust us after our assessment of I-80 Tolling, a minimum wage increase, the Act 1 property tax relief sham, state pension increases, and "economic development" grants, proved true; and that there are no political games being played here.


Joe Gable said...

I love tax cuts, but this was a bit out of hand yesterday in light of the fact that they are not addressing cuts in SPENDING!!!! Simply math, keep spending at the present rate and reduce taxes (income) you have a big hole in the budget. CUTS in SPENDING must be enacted!


Commonwealth Foundation said...

Lowering government intake (tax cuts) forces the government to lower its output (spending).

This is precisely what is needed as the state goes into the budget season.

Don't look a gift horse in the mouth, Joe Gable. Tax cuts will drive spending cuts.