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New Report: Low-income Pennsylvanians Pay Larger Share of Income in Taxes

November 26, 2008

Taxes. We all have to pay 'em. But are some people paying more than their fair share during this time of economic turmoil? A new budget report says that's the case in Pennsylvania.

The Pennsylvania Budget and Policy Center/em> recently issued a report titled "The Common Good: What Pennsylvania's Budget and Tax Policies Mean to You." The document claims Pennsylvania has one of the most regressive tax systems in the United States, taking a significantly larger share of the incomes of the bottom 20 percent of earners, as compared to more affluent Pennsylvanians.

Sharon Ward, director of the Center, says the state's flat personal income tax rate is unfair to working families, taking more than 12 cents of every dollar they earn, while those who earn far more money pay just over four cents on every dollar.

"If we had a system in which higher income earners were paying more, we could reduce the tax share on working families and have a system that is more fair."

Opponents say increasing taxes on the rich just because they earn more money would be unfair. But Ward says that without a progressive income tax, Pennsylvania's state tax system has no way to offset regressive sales and property taxes.

The report comes at a critical time in the budget debate. Pennsylvania lawmakers are currently considering ways to increase revenue, as well as spending cuts to eliminate the state's huge budget deficit. Ward says the economic downturn should not be used as an excuse to cut programs that help keep working families afloat.

"We think there needs to be a be a balanced approach, and we think the state needs to look at ways of expanding the tax base, for example, by closing corporate tax loopholes."

Ward says the state could also expand the sales tax, or add a tax on natural resource extraction as a way to generate more revenue.

The entire report from the Pennsylvania Budget and Policy Center is available online at

Kelly Glorioso Fodel, Public News Service - PA