Higher taxes all ’round: 3 things to know about IFO report on Wolf’s tax plan | PA Independent
Conservative Democratic Gov. Tom Wolf is defending his proposed budget against interpretations of the plan by Pennsylvania Independent Finance Office, which is being used by #Teapublicans and Club for Growth Toadies as a weapon.
All Pennsylvanians would face higher taxes if Gov. Tom Wolf’s budget proposal becomes law.On the campaign trail and in his first budget plan, Wolf had pitched an ambitious overhaul of Pennsylvania’s tax system that he said would place a larger burden on high-income households while shielding those who made less than $70,000 per year. But the administration is now playing defense after an analysis released last week by the state’s Independent Fiscal Office showed that even the lowest-income Pennsylvanians would see a net tax increase under Wolf’s proposal.
“The analysis finds a net tax increase for all groups, including a small net tax increase for the lowest income group,” the IFO concluded, setting off rounds of we-told-you-so from Republican lawmakers who have been skeptical about Wolf’s ideas.
But the analysis is more nuanced than that one sentence would suggest. The IFO shows that Wolf’s proposal would mean higher taxes for all, yes, but it would also mean significantly higher taxes for high income households compared to lower income ones.
According to the IFO, Wolf’s tax plan would generate $4.6 billion in new revenue. Most of the increases would fall on those making more than $100,000 per year.
The IFO is a nonpartisan number-crunching agency that fulfills a similar role to the federal Congressional Budget Office. It is required by law to analyze any proposed changes to the state’s tax and revenue structure.
The administration responded on Friday by challenging some of the IFO’s projections.