Chamber Minute

February 2017

Hi, I’m Gene Barr, president of the Pennsylvania Chamber.


Welcome to this month’s Pennsylvania Chamber Minute.


Earlier this month, Governor Tom Wolf presented his third spending plan to a joint session of the General Assembly. His address struck a conciliatory tone and focused on the policy achievements that were made over the past year working with a heavily Republican legislature. Such collaboration will also be necessary in this year’s budget talks, as the state faces a $3 billion structural deficit that is the result of several months of lower than expected revenues and continued increases in financial obligations – namely, a growing public pension debt that could be as high as $74 billion.


We applaud the governor for looking at smart new ways to streamline state government in order to more efficiently use taxpayer dollars in the coming fiscal year. He wants to consolidate up to four agencies, downsize state buildings, eliminate duplicative services and refinance debts to save a projected $2 billion. However, the proposal also looks to impose tax increases on Pennsylvania’s employers. More than $1 billion in tax hikes are included in the governor’s budget plan, including an expansion of the state’s sales tax base; making several changes to the way that corporations file their taxes and calculate deductions; an expanded insurance premiums tax; and a 6.5 percent severance tax on the natural gas industry. Coupled with this is a plan to raise the minimum wage to $12 an hour – a policy proposal that the PA Chamber has long opposed for the burdens it puts on small businesses and the job opportunities it takes away from lesser-skilled workers.


While we commend Governor Wolf for his outside the box thinking to help generate taxpayer savings, the Pennsylvania Chamber is expressing serious concerns about how the proposed tax increase package will impact economic growth and job creation. We’re also urging elected officials to enact a comprehensive public pension reform bill in the coming months, since the public pension crisis remains the state’s biggest cost-driver and takes up a larger share of state spending each year. Pension reforms are necessary to put us back on the path toward a stronger economic future and to protect against continued tax hikes on employers and working families statewide.


Thanks for spending a minute of your time with the Pennsylvania Chamber, the Statewide Voice of Business.