The Faces of 90.5 WESA
Economy & Business
Wed December 26, 2012
Tax Increases v. Budget Cuts, Who Wins in PA?
New analysis by the left-leaning Pennsylvania Budget and Policy Center (PBPC) shows that proposals to end tax breaks for high-income earners would have very little impact on taxpayers in most Pennsylvania counties.
The greatest impact from higher taxes on family incomes of more than $250,000 would only affect six counties: the four suburban Philadelphia counties, Philadelphia and Allegheny County. Almost two-thirds of the wealthiest two percent of taxpayers reside in these six counties. Even so, only one in 31 taxpayers (3.2 percent) in these six counties would be impacted by the higher tax rates.
In most counties, only a small number of individuals are affected. In 24 counties, fewer than 200 high-income earners would pay the higher rate. PBPC spokesperson Sharon Ward said the choice is clear when it comes to choosing between increases in taxes and cuts in social service spending.
“Two percent of Pennsylvanians might pay more under the plan. At the same time, about 20% of Pennsylvanians are receiving social security. So if the choice is raising taxes on the top two percent, or cutting social security, ten times more people will be affected by the social security cut.”
Ward also notes that the hope of this would be to show members of Congress information they maybe didn’t know.
“Exactly how many people and what share of their constituents would be affected by this tax change to make the point that it is very limited and that in many of the rural counties, where you have the most opposition to raise taxes on the top two percent, those counties actually have the fewest number of people who would be affected.”
In more than half of Pennsylvania’s 67 counties, fewer than 1 in 100 residents would pay the higher marginal tax rate on income above $200,000 for individuals and $250,000 for married couples.
The PBPC estimates, based on 2010 taxable income data published by the Pennsylvania Department of Revenue, show that, in most Pennsylvania counties, very few taxpayers and only a small share of income in the county would be impacted by higher federal income tax rates that drop in at $250,000.