Personal Income Tax

Mary Wilson / 90.5 WESA

  Gov. Tom Wolf’s revised tax package failed a vote in the state House on Wednesday as nine members of his own party voted against it. 

Republicans and Democrats disagreed about what the vote proved, and shared no specific plans for finalizing a state budget that is now 100 days late. 

Gov. Tom Wolf is scaling back his tax wish-list ahead of an expected vote in the House on Wednesday.

The revised proposal, released Tuesday afternoon, includes a smaller personal income tax increase and a natural gas drilling tax, but no sales tax hike or increases to cigarette and business taxes.

Pennsylvania dropped eight places in the last year to become one of 10 states with the worst economic outlooks, according to the annual “Rich States, Poor States” report published by the conservative American Legislative Exchange Council (ALEC).

Based on 15 criteria including individual and corporate tax rates, the eighth annual report ranked Pennsylvania 41 out of 50 states in terms of economic outlook and competitiveness.

Pennsylvania’s coffers continue to be not as full as state officials anticipated. For a third straight month, revenue collections were lower than expected. 

According to the Department of Revenue, Pennsylvania pulled in $1.6 billion in funds in February which was 2.1 percent below projections. For the first eight months of the fiscal year, total revenues are 0.5 percent less than estimates.

The IRS and Pennsylvania Department of Revenue will get a bit of a late start this tax season, thanks to the 2013 federal government shutdown.

Both federal and state tax returns will begin processing refunds on Jan. 31. Still, people can get a jump on filling out the forms. As of Jan. 17 both the IRS and Pennsylvania will allow online free-file options.

The U.S. Supreme Court’s striking down of the Defense of Marriage Act (DOMA) might have same-sex married couples worried about what changes are in store for them this tax season. But Joseph Nicola of Sisterson & Co., a Pittsburgh accounting firm, says filing shouldn’t be any more difficult than last year.

Nicola said the Supreme Court case United States v. Windsor means that married same-sex couples can take advantage of more benefits.

Two months into the new fiscal year, Pennsylvania’s revenue collections seem to be lagging just a little behind, with the Pennsylvania Department of Revenue’s General Fund bringing in $3.7 billion— 0.1 percent below estimate.

In August, corporation tax, inheritance tax and realty transfer tax all fell below the state’s projections. Only sales, cigarette, alcohol and table game tax revenues were above estimates.

Legislation Could Eliminate School Property Tax

Aug 14, 2013
Tim Lambert / WITF

After a year of review, Pennsylvania House Representative Jim Cox reintroduced House Bill 76 outlining the benefits of eliminating the school property tax in the Commonwealth. With 91 co-sponsors in the House and 22 in the Senate, Rep. Cox is confident the bill will appeal to both legislators and tax-payers. Matthew Knittel, director of the Independent Fiscal Office, has reviewed versions of the bill and says from a revenue perspective, the bill could be made to work in certain parts of the state.