June 19th, 2009
Yesterday, Gov. Rendell defended the income tax increas he proposed and also said the $2 billion in cuts he made are real, even if his bottom line has barely budged, reports the Associated Press.
He also said he would consider signing a stopgap budget bill that would prevent state employees from having to work without being paid until a budget passes. Similar tactics were employed in 1977 and 1988; in 2003, Rendell vetoed the education portion of the budget, and it took months to reach agreement on it.
Senate Majority Leader Dominic Pileggi, R-Delaware, said any such interim plan would have to take a bare-bones approach and not simply continue at 2008-09 spending levels.
“The concern is that simply delays the time for making these hard decisions,” Pileggi said. “On the other hand, the benefit is that critical and essential governmental functions continue without interruption.”
Pennsylvania is facing a projected $3.2 billion revenue shortfall for the current year, and Rendell is proposing a mix of spending cuts and tax increases to address it.
“We have to have increased revenues,” said Rendell, who this year also has floated proposals for higher taxes , or new taxes , on health insurance premiums, retail sales, tobacco, natural gas extraction and video poker. “When you look at the numbers, the numbers drive the discussion.”
Rendell said no lawmakers who voted for the last state income tax increase, in 2003, lost re-election the following year. This year, he said, the decline in tax revenues and other factors have left them little choice. Rendell wants to increase the state’s personal income tax rate from 3.07 percent to 3.57 percent, so someone making $50,000 a year would typically pay an additional $250 in taxes. It would raise $1.5 billion annually for three years, then expire.
June 26th, 2009 at 8:48 am
As a registered nurse for the commonwealth of PA, I’ve spent some time reading on the up coming budget impass and its effect on my paycheck as well as countless others. In a time of economic crisis, so many individuals are struggling to makes ends meet, therefore the idea of missing earned pay is terrifing most. I have read that tax increases will have a servere negative impact on taxpayers. While I am not in support of these increases, I also believe that withholding paychecks of state employees who have worked their designated hours will be devistating. Is it fair to utalize the state employees as pawns to resolve a budget. After all the majority of the state workers are nothing more than ordinary people just attempting to earn a living.