Penna. senate votes to raise taxes

PENNA. SENATORS EMBRACE DETROIT ECONOMICS

BUDGET PROCESS IS BACKWARDS

 

The Pennsylvania Senate voted last week 26-24 to raise taxes to fill the budget deficit. The problem started when they passed a budget earlier in the year that was above expected revenues. I guess they thought that a miracle might happen or the tooth fairy would be generous. Why would you start the states budget process with passing a spending bill? Why not estimate revenues and then pass a budget that is balanced? Why not skip the increases and have department heads make the necessary cuts? Not the way government works. It is always more, even if the states business activity is declining.

Local Senators voting NO, were Argall, Boscola, and governor candidate Wagner. Voting YES to raise taxes were Browne, Leach, Scavello,Yudechak, and Mensch.

 

They have voted to raise $405 million from increased taxes on electric, phones and natural gas. Checking my phone bill I see that I am already paying 21% in taxes and fees. I guess they feel it is not enough.

 

They also are still salivating at the thought of taxing the gas drillers, imposing a $100 million  severance tax. They hope the drillers will actually take the gas or will they use the gas in other states first.

 

Then they hope to tax $43.5 million on internet sales. Problem is the supreme court has ruled you can't tax customers in other states unless you have a business located in that state. I doubt that customers in other states will agree to pay the tax. Or will they attempt to extract it from resident sellers in the state. They may have to pay more to enforce this tax than they can collect.

They also plan to borrow $1.5 billion from the tobacco settlement fund. Does anyone believe it will be paid back?

They also want to expand Casino gambling to add another $200 million.

We will have to see what the House does with this bill.

So, some of this will raise revenue, some may not. It will certainly drain money from the residents of the state. This will likely slow economic activity and make the state less competitive with other states. Less activity will equal less revenue, and then under the Detroit economic plan, just raise taxes some more.