Local Tax Issues

Pennsylvania Becomes Latest State to Consider Nixing Income Tax

Pennsylvania Becomes Latest State to Consider Nixing Income Tax

Pennsylvania has joined several other states, including Louisiana, in considering an income tax ban at the state level. 

There are currently nine U.S. states without personal income tax -- Wyoming, Washington, Texas, Tennessee, South Dakota, Nevada, Florida, and Alaska. According to Harrisburg news station ABC 27, State Senator Greg Rothman (R-Cumberland/Dauphin/Perry) is leading the charge for Pennsylvania to join this list.

GettyImages-1415793430_resized_pennsylvania-statehouse
Credit: Manuel Augusto Moreno/Getty Images

Rothman believes that the state's existing income tax structure has led college graduates and business owners to leave The Keystone State for states with a lower cost of living.

He said that nixing the state’s 3.07% personal income tax would send taxpayers "a message that we are serious in our pursuit of job creation, growth and keeping hard-earned dollars in the pockets of working people.”

The Pennsylvania Department of Revenue shares that the state's existing tax rate applies to the personal income of resident and nonresident individuals, estates, trusts, partnerships, S-corporations, business trusts, and limited liability companies (LLCs) that are not federally taxed as corporations. 

The state would, of course, have to come up with a way to account for the funds that would be lost by eliminating income tax.

In a recent memo, Rothman announced he would be announcing official legislation in the "near future." Since the bill has not yet been introduced, potential solutions for the income the state would lose have yet to be devised. 

GettyImages-1403270625_resized_pennsylvania-statehouse
Credit: Ethan Coston/Getty Images

It is, however, likely that Rothman and his supporters will face opposition. 

Some -- politicians and citizens alike -- believe that eliminating income tax will raise taxes in other areas, such as sales tax or property tax. Alternately, these individuals feel that infrastructure projects, such as road maintenance, could be neglected if the income tax funds are not made-up in some other way. 

It remains to be seen precisely what will happen in Pennsylvania but this will undoubtedly be a hot-button issue. 

What do you think? Should PA eliminate state income tax?

You Might Also Enjoy:

share this post
Search for matches...
Rebekah Barton

Rebekah Barton

Rebekah's search engine optimization career began completely by accident as a college student. Over the course of her career so far, she has "grown up" with the SEO industry, from writing content while juggling classes to managing her own teams of writers and overseeing SEO strategy in subsequent roles. She is excited to bring her passion for high-quality content to CountingWorks, Inc.

Recommended Professionals

In the face of economic uncertainty, TaxBuzz is the industry's most up-to-date tax information.

Join 60,000 who get our weekly newsletter. No spam.

Need help selecting a firm?

Use our specialized search engine and get matched to the best accounting and tax firm for your needs.

Related Posts

Latest Posts