NFIB Tells Senators 21 percent increase in PA Personal Income Tax hurts small business.
Governor Tom Wolf proposes increasing state spending by 16%. In turn, he wants to increase in the Personal Income Tax by a whopping 21 percent and increase and expand the Sales Tax.
This plan would really fall hard on small businesses. That’s because most are set up as pass-through companies such as partnerships, LLCs and sole proprietorships. And taxes for those small business owners are paid through their Personal Income Tax. While the governor wants to lower the corporate tax rate, that will actually only benefit 20% of Pennsylvania’s businesses.
The governor claims that raising the PIT will be balanced by a reduction in property taxes. But, that only applies to property where the person lives, not the land they might own or rent where their business is located.
There are other consequences for small business in the Governor’s plan. Expansion of the sales tax to accounting, payroll and legal services will hurt smaller companies that hire those types of experts. Larger companies would avoid that additional tax because they are more likely to have employees who perform those duties.
Last week NFIB testified against increasing those taxes before the state Senate Finance Committee. We want to make sure our elected officials know what our members face on a daily basis and how government tax and spend policies can hinder business growth.
Sincerely,
Kevin Shivers
Executive State Director, NFIB Pennsylvania
