The PA Chamber hosted a virtual Government Affairs Roundtable for its Investor Members last week, offering an exclusive, inside look at this year’s state budget agreement.
The meeting featured a rundown of several pro-business victories in Pennsylvania’s 2024-25 state budget as well as insights into how it will impact various issues relevant to the business community.
Key Budget Highlights
This year’s budget focuses on several critical areas, including permitting, business taxes, and workforce development:
Permitting Reform
The budget includes significant improvements to state permitting processes that will reduce delays in development and business expansion projects. These reforms include allowing employers to work with third-party professionals to help facilitate the review of applications for many key permits, establishing timeframes for responses, and measures for easier and more transparent tracking of permit applications.
These reforms will streamline the permitting process, further encouraging investment and job creation, and help ensure that the newly authorized funding for the PA Strategic Investments to Enhance Sites (SITES) Program is successful in preparing business sites for development.
Tax Reform
This budget gradually eliminates Pennsylvania’s Startup Tax by prospectively improving the tax treatment of net operating losses (NOLs), which allows businesses to carry losses forward and deduct them against future profits to reduce their tax liability so they can reinvest in their business and people.
This change will ultimately align Pennsylvania with the federal standard and the rest of the country. As a result of this change, Pennsylvania will be a more attractive destination for new and growing businesses.
Additionally, the budget continues the phasedown of the Corporate Net Income Tax, which will be further reduced from the current 8.49 percent rate to 7.99 percent in 2025, ultimately reaching 4.99 percent in 2031.
Workforce Development
The budget also advances initiatives to build a skilled workforce. Initiatives include increasing the Commonwealth’s investment in career and technical education (CTE) and making it easier for qualified individuals to become CTE educators; incentivizing employers to reimburse employees for childcare expenses; creating scholarships for students who choose to enter in-demand fields; increasing the Pennsylvania Housing Affordability and Rehabilitation Enhancement (PHARE) fund to expand the availability of workforce housing in Pennsylvania; and increasing transportation funding to help Pennsylvanians get to work.
For a full rundown of the contents of this year’s state budget, please click here.
To read the PA Chamber’s statement on the budget, please click here.