June 11th, 2009

Yesterday, Gov. Rendell said that if he has to push for an increase to the state’s income tax to help balance the budget, he would want the increase to expire after three years.  He did not state how much of an increase he would push for, although it is very unlikely that an increase to any broad-based tax would make it through the Republican controlled Senate.

Reports the Philadelphia Inquirer:

Rendell said he was waiting for the most up-to-date projection of next year’s growth in state tax revenue before making a final decision.

“But if, in fact, we have to raise taxes of any sort, it would be sunset,” Rendell told reporters at a news conference in an old steel town near the capital. “And the reason we would need to do it for a short period of time is because of the recession.”

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Republicans who control the Senate have made it clear they do not support any increase in any taxes, but are particularly vehement about not raising any broad-based taxes such as income or sales.

Even some Democrats might be reluctant to vote for a personal-income tax hike, given that next year is an election year.

Senate Majority Leader Dominic Pileggi (R., Delaware) said in no uncertain terms yesterday that his caucus would not support a Democratic proposal to raise income taxes, even temporarily.

Promising that such an increase would be temporary, said Pileggi, “would largely be a fiction.” He pointed out that the so-called Johnstown flood tax – a temporary tax on the sale of alcohol approved in 1936 – was never reversed. It is now 18 percent.

Pileggi also said it would be highly risky for Rendell to time the sunset to the year that federal stimulus dollars stop flowing to states.