Wolf seeks billions in higher taxes for schools
HARRISBURG — In an ambitious first budget plan, Gov. Tom Wolf today proposed more than $4 billion in higher taxes on income, sales and natural gas drilling to support new spending on schools and to cut property taxes to overhaul the way public education is funded.
Wolf, a Democrat, is also asking the Republican-controlled Legislature to cut corporate taxes by hundreds of millions of dollars, borrow more than $4 billion to refinance pension debt and inject new money into business loans, clean energy subsidies and water and sewer system projects.
Saddled with a budget hole of more than $2 billion and a $1.6 billion increase in mandatory costs in the budget year that starts July 1, Wolf said his plans would put the state on sound financial footing after three credit downgrades last year.
If passed, it would represent the biggest revamp in state taxation in decades.
He said his budget would make the tax system fairer, improve public schools hit hard by recent cutbacks in state aid and foster a more vigorous business environment that produces more good-paying jobs. The total tax burden on average middle-class homeowners would drop by 13 percent under his plan, Wolf said.
Wolf told a joint session of the Legislature, “It is a balanced budget, and it eliminates our $2.3 billion deficit. But above all, it recognizes that Pennsylvania will not improve until we rebuild the middle class.”
Wolf's spending plan would increase overall state spending through the state's main bank account by about 3 percent to $29.9 billion from the current year's approved budget. Counting $1.75 billion in pension obligation payments to the Public School Employees Retirement System and $2.1 billion in school property tax relief receipts, the increase is about 16 percent to $33.7 billion.
