State Budget and Taxes

Sales, Income Taxes to Rise; Corporate Taxes Not So Much

As I blogged last week, state budget forecasters are not predicting much growth in revenue collections over the 2013-14 fiscal year. In fact, tax revenue is projected to have the smallest rate of growth since the 2009-10 fiscal year, according to official estimates from the Pennsylvania Department of Revenue.

Third and State This Week: Nutrition Assistance Cuts, Fast Food Worker Strikes, Modest State Revenue Growth & More

This week at Third and State, we blogged about a pending cut and other threats to federal nutrition assistance, what the one-day strikes by fast food workers tell us about the future of the middle class, a post-recession pay cut for the nation's low-wage workers, state revenue growth in the year ahead, and the role of public safety net programs in keeping people out of poverty.

IN CASE YOU MISSED IT:

  • On food insecurity, Chris Lilienthal blogged about a report on the significant impact that a pending cut in nutrition assistance will have on low-income families across Pennsylvania and the nation. He also shared a New York Times report on a new study finding that additional cuts proposed by the U.S. House would cost more than 5 million Americans needed food assistance.
  • On unions and the economy, Stephen Herzenberg wrote that the fast food workers engaging in one-day strikes across the country may be on the verge of cracking the code to the next U.S. middle class.
  • On income inequality, intern Ellis Wazeter blogged about a recent study showing that low-wage American workers have taken a post-recession hit to their paychecks.
  • On state taxes, Michael Wood shared a chart showing that General Fund revenue collections are projected to grow very little in the 2013-14 fiscal year.
  • And on poverty, Chris Lilienthal passed on a blog post by Arloc Sherman of the Center on Budget and Policy Priorities highlighting just how much public safety net programs have helped keep people out of poverty in the United States.

IN OTHER NEWS:

PA Projects Modest Growth in Tax Collections

The budget bills are finally passed, and all the numbers have been crunched. So where does the state expect General Fund revenue collections to be at the end of the next fiscal year? Not too far from where they are today.

Third and State This Week: Upward Mobility, Pittsburgh and Detroit, Revenue Wrap, and Diversion Politics

This week at Third and State, we blogged about a new study showing the American Dream of upward mobility is more alive in Pennsylvania than in many parts of the country. We also wrote about 2012-13 revenue collections and a well-oiled effort to distract middle-class families from the real cause of their economic struggle. Plus, a guest post on how Pittsburgh avoided Detroit's fate.

IN CASE YOU MISSED IT:

  • On wages and mobility, Stephen Herzenberg blogged about a new study by Harvard and Berkeley economists showing that Pennsylvania enjoys substantially more upward mobility than many other parts of the United States.
  • On state budget and taxes, Michael Wood explained some of the key takeaways from General Fund revenue collections in the 2012-13 fiscal year.
  • On nutrition assistance, Stephen Herzenberg responded to the latest salvo in an organized right-wing assault on nutrition assistance and other safety net spending. Steve wrote that the real kitchen table issue facing most Americans is rising income inequality.
  • And on the Marcellus Shale and the economy, guest blogger Tim Stuhldreher shared his thoughts on why Pittsburgh has fared much better than Detroit after taking huge economic hits in the 1980s. Hint: it is not all about shale drilling.

IN OTHER NEWS

A Revenue Wrap for 2012-13

Last week I shared a chart tracking General Fund revenue collections compared to official estimates over the 2012-13 fiscal year. Here it is again.
2012-13 General Fund Revenue Surplus/(Deficit) by Month

Now for a bit more analysis.

Third and State This Week: Fewer College Grads Starting Businesses and State Revenue Collections in 2012-13

This week at Third and State, we blogged about student loan debt deterring college grads from starting their own businesses, income inequality and efforts to turn back prevailing wage laws for construction workers, and revenue collections during the now-completed 2012-13 Fiscal Year.

IN CASE YOU MISSED IT:

  • On higher education, Jamar Thrasher blogged that more and more American college graduates are declining to start their own businesses partly because of the rising costs of tuition and crushing student loan debt.
  • On income inequality and the prevailing wage, Stephen Herzenberg wrote that too many people in the "1%" (and the smaller groups at the very, very top) seem to have convinced themselves that they are not only more deserving but also somehow different than — better than — other people.
  • And on state budget and taxes, Michael Wood shared the following chart tracking monthly revenue collection trends in the now-completed 2012-13 Fiscal Year.
    2012-13 General Fund Revenue Surplus/(Deficit) by Month

STATE BUDGET RESOURCES:

A Look at the Fiscal Year that Was

With Pennsylvania's 2012-13 fiscal year in the rearview mirror, here is a look at how General Fund revenue collections compared to official estimates (click on the image for a larger view).

As you can see, monthly collections came in below projections almost as often as they came in above, with year-end receipts nearly $57 million ahead of the annual estimate. (The line tracks the cumulative annual surplus/deficit from month to month.)
2012-13 General Fund Revenue Surplus/(Deficit) by Month

Third and State This Week: Budget Analysis, Food Security Danger, Unremarkable Private Job Growth & Payday Lenders

This week at Third and State, we blogged about the state budget, the danger facing America's leading food security program, Pennsylvania's unremarkable private-sector job performance, and a gambit by payday lenders that backfired.

IN CASE YOU MISSED IT:

  • On state budget and taxes, Sharon Ward shared the Pennsylvania Budget and Policy Center's detailed analysis of the 2013-14 budget, and Michael Wood explained that tax changes enacted along with the budget made some steps toward reform but weigh the state's Tax Code down with more special interest tax breaks.
  • On the federal budget, Sharon Ward wrote that legislation separating agricultural programs from nutrition supports funded through the farm bill poses a threat to food assistance for millions of struggling parents, children, and vulnerable citizens.
  • On jobs, Stephen Herzenberg blogged that Pennsylvania’s private-sector job growth has almost stalled since about a year into Governor Corbett's term.
  • On consumer protection, Mark Price explained how payday lenders won few friends in the state Senate when they convinced House leaders to insert language into a must-pass Fiscal Code bill stating it was the intent of House and Senate leaders to enact payday legislation in the fall.

STATE BUDGET RESOURCES:

Everything You Need to Know about 2013-14 Budget

The Pennsylvania Budget and Policy Center has released a full detailed analysis of the 2013-14 state budget plan spending $28.376 billion, roughly $645 million (or 2.3%) more than in the 2012-13 fiscal year.

Governor Tom Corbett signed the budget into law late in the evening of June 30, 2013. Overall, the plan is $64 million less than the Governor proposed in February, reflecting nearly $113 million in reduced spending for public school pensions and school employees’ Social Security payments along with a shift of $90 million in General Fund spending off budget to other funds.

2012-13 General Fund Summary
(in $ Millions)
  2012-13 2013-14 Gov. 2013-14 Final Change f/ 2012-13 % Change
General Fund $27,731 $28,440 $28,376 +$645 2.3%

Small Steps Toward Reform But Special Tax Breaks Remain

Among the final pieces of the 2013-14 budget package now before the Governor is a Tax Code bill that sets tax rates and makes permanent changes in tax law.

The bill, approved by the House and Senate last week, includes two very important provisions: 1) It maintains the capital stock and franchise tax, which was set to expire at the end of 2013, for two more years, and 2) For the first time, it takes steps to close the Delaware loophole — although not until 2015.

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