Harrisburg scrambles for revenue.

PA could have a 1.3 billion increase in spending to fund a $31.5 billion election-year budget. That’s the latest number. Now they wrangle over how to raise revenue. That’s the topic of debate right now in Harrisburg.

It seems like the rumored list of possibilities is becoming clearer. New taxes could include:

  • Gambling expansion – I call this one a gimmick. It could include Licensing fees on internet based gaming and also expanding gaming machines in bars and taverns. Personally I’ve always had mixed feelings on any kind of gambling expansion. I think one thing most can agree on is it’s never delivered the amount of relief promised. In the case of internet gambling we can look to New Jersey where revenues have underwhelmed and some say led to further poaching of dollars from traditional casinos. Peter meet Paul.
  • Energy taxes – A broad based consumer tax. This is a preference of the Gov. It would mean extending existing gross receipts tax to natural gas customers. This could amount to around $55 a year for the average residential customer.
  • Taxes on banks – Institutional tax. A tax on savings. Don’t quite understand this. Not much information out there about this.
  • Uber and ride-sharing taxes – Wetting governments beak on a new and very successful disruptive tech. Uber is now pretty much legal everywhere in PA except Philly. Although that may have recently changed.
  • Digital download tax – I look at this as closing a loophole. Potentially on purchases ranging from music to movies. It’s a consumer tax.
  • I keep reading another piece is “Tax amnesty legislation” – I’m not sure what this means, but tax amnesty is generally related to forgiveness on delinquent bills. I can’t find information on what this entails. Will we offer more flexibility in hopes of getting more late or delinquent accounts paid up? Maybe this is a good reform? I need to learn more.
  • Accounting magic – Also read last couple days the use of an accounting trick essentially to borrow from the workers compensation fund. To be fair, this sort of accounting trick is used quite frequently in most levels of government.

I hope these capsules and links help folks navigate what’s proposed. As is usually the case most strategies are paired with optimistic (unrealistic) revenue projections. And we have unresolved concerns of how this relates to the states constitutional mandate for a balanced budget.

What we know is, the 1.X billion more in spending is driving the need to raise revenue. The conversation now is what combination of taxes make the most sense to do that.

We can argue what mechanisms are more or less “fair”. We should instead be debating how we re-prioritize, enact structural reform and reduce overall spending. Then the convo would not be about which taxes are “better” or somehow less burdensome and talk about what taxes we actually roll back first. Spending is going in the wrong direction and leaders are again punting on reform.

I’m a realist. I never had a burn it down type attitude. I understand the state funds many critical or otherwise important programs. Taxes on some level are reality. Also compromise is a reality of our Democratic system. But we’re failing again to address a number of areas where inherent waste exists where allegedly we have agreement across the aisle. I believe the money needed to address our priorities exists today. We have more than enough. We just need to 1.) In some cases shift the burden. For example school funding away from homeowners. #SB76 and  2.) Understand that more overall revenue because of increased overall spending is almost never the answer to anything. #nonewtaxes