United States

Pennsylvania: Governor Wolf Releases Proposed Fiscal Year 2017 Budget

Feb 15, 2016
From KPMG TaxWatch

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For most of the last 12 months, Pennsylvania lawmakers and Governor Wolf have been at an impasse over the adoption of a budget for the 2015-2016 fiscal year that began July 1. Governor Wolf, a Democrat, has asked for certain tax increases, primarily to fund education. Budget proposals that would increase taxes have repeatedly been rejected by the Republican-controlled legislature. Recently, Governor Wolf released his fiscal year 2017 budget, which also includes a number of tax increases. Under his plan, Pennsylvania’s personal income tax rate would be raised from 3.07 percent to 3.4 percent, and the bank shares tax rate would increase from .89 percent to .99 percent. A new 6.5 percent severance tax would be imposed on natural gas extraction. The proposal also calls for an expansion of the sales tax base, which would raise an estimated $414.6 million in the next fiscal year. It has been reported that the imposition of sales tax would be extended to purchases of basic cable television, movie theater tickets and digital downloads. In addition, certain vendor discounts would be limited. Please stay tuned to TWIST for additional updates on Pennsylvania’s budget process.

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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.

The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.