Midyear Budget Briefing: Unaffordable Tax Cuts Drive State Funding Gap

HARRISBURG, PA (December 5, 2012) - Sharon Ward, Director of the Pennsylvania Budget and Policy Center, issued the following statement today on the midyear budget update:

"Hundreds of millions of dollars in new business tax cuts enacted over the past two years are a major contributing factor to the gap between revenue and expenditures highlighted by Budget Secretary Charles Zogby today. Lawmakers have dug a hole in the next budget with special tax breaks that have failed to create jobs but do threaten the state's ability to invest in the fundamentals that ensure long-term growth. In addition, cuts made to public schools, county human services and colleges have cost jobs, hurt local economies and further eroded tax revenue. In the 2011-12 school year, Pennsylvania lost 20,000 jobs in education, more than were added through gas drilling in the Marcellus Shale since the start of 2010. For the first time since the recession began, the state's unemployment rate is above the national level.

"It's time to get Pennsylvania back on track by investing again in education, transportation and local communities. That is how Pennsylvania will continue to be a state where people want to raise a family or start a business."


A visual look at how recently enacted business tax cuts are contributing to a state funding gap next year (click on the image for a larger view).