Print
E-mail
Pa. Business Leaders: Tax Increases Avoidable
By Bradley Vasoli, The Bulletin
Private-industry leaders in Pennsylvania gathered in Harrisburg yesterday to advise against increasing any taxes to cover the projected $2.3 billion state budget deficit.
Gov. Ed Rendell, D, has already cut roughly $500 million in spending to mitigate the shortfall. How he decides to handle its remainder will have pressing implications for businesses and workers across the state, the industry representatives said.
According to National Federation of Independent Business (NFIB) state director Kevin Shivers, a quarter of Pennsylvania’s small-business principals don’t expect to see their enterprises withstand the recession. Higher taxes would only further impede these businesses’ survival, he said. He therefore urged government cost cutting.
“Given the current economic conditions, Pennsylvania job creators cannot continue to bear the cost of a growing state bureaucracy and ever-increasing state spending,” Mr. Shivers said. “Lawmakers should give careful consideration to consolidate departments and cabinet positions or combine programs that overlap or meet duplicate goals.”
Leaders of the Associated Petroleum Industries of Pennsylvania, the Pennsylvania Manufacturers Association, the Pennsylvania Retailers’ Association and 15 other industry groups are spearheading a “Grace Commission” to address the matter. The commission would be made up of members of the business community from across the commonwealth.
The coalition wants the panel to consider ways the state could consolidate and otherwise reduce the costs of cabinet departments and other executive agencies, legislative commissions and job-training programs. Its members also favor the elimination of the Opportunity Grant Program, which provides financial assistance to expanding businesses on the basis that they will create jobs, a promise many recipients have reportedly failed to keep.
A worst-case scenario for resolving the budget problem, the industry advocates said, would be a tax increase on the scale of the 1991 tax hike on businesses. They said that move did much to hurt computer services and other burgeoning industries in the state.
Such an industry that could suffer similar harm, they said, is natural gas. Mr. Rendell is contemplating the placing of a natural-gas severance tax to reap more revenues from the Marcellus Shale site in central and western Pennsylvania.
David Taylor, executive director of the Pennsylvania Manufacturers’ Association, said such a tax would hamper the ability of the natural-gas industry to thrive in the state. Such a tax caused natural-gas extractors to leave a promising site in New York alone, he said.
“If this new industry takes hold and is successful, absolutely it is going to be contributing to the public treasury in the same way that it’ll be contributing to the overall economy [but] there is a great danger that state government is going to get greedy, and smother this emerging industry in its crib,” Mr. Taylor said.
Rendell spokesman Michael Smith countered that many other states have wellhead taxes of the kind the governor is considering and have nonetheless managed to keep the natural-gas companies from going elsewhere.
“We are among a handful of states that don’t have such a tax,” he said.
Bradley Vasoli can be reached at bvasoli@thebulletin.us
Gov. Ed Rendell, D, has already cut roughly $500 million in spending to mitigate the shortfall. How he decides to handle its remainder will have pressing implications for businesses and workers across the state, the industry representatives said.
According to National Federation of Independent Business (NFIB) state director Kevin Shivers, a quarter of Pennsylvania’s small-business principals don’t expect to see their enterprises withstand the recession. Higher taxes would only further impede these businesses’ survival, he said. He therefore urged government cost cutting.
“Given the current economic conditions, Pennsylvania job creators cannot continue to bear the cost of a growing state bureaucracy and ever-increasing state spending,” Mr. Shivers said. “Lawmakers should give careful consideration to consolidate departments and cabinet positions or combine programs that overlap or meet duplicate goals.”
Leaders of the Associated Petroleum Industries of Pennsylvania, the Pennsylvania Manufacturers Association, the Pennsylvania Retailers’ Association and 15 other industry groups are spearheading a “Grace Commission” to address the matter. The commission would be made up of members of the business community from across the commonwealth.
The coalition wants the panel to consider ways the state could consolidate and otherwise reduce the costs of cabinet departments and other executive agencies, legislative commissions and job-training programs. Its members also favor the elimination of the Opportunity Grant Program, which provides financial assistance to expanding businesses on the basis that they will create jobs, a promise many recipients have reportedly failed to keep.
A worst-case scenario for resolving the budget problem, the industry advocates said, would be a tax increase on the scale of the 1991 tax hike on businesses. They said that move did much to hurt computer services and other burgeoning industries in the state.
Such an industry that could suffer similar harm, they said, is natural gas. Mr. Rendell is contemplating the placing of a natural-gas severance tax to reap more revenues from the Marcellus Shale site in central and western Pennsylvania.
David Taylor, executive director of the Pennsylvania Manufacturers’ Association, said such a tax would hamper the ability of the natural-gas industry to thrive in the state. Such a tax caused natural-gas extractors to leave a promising site in New York alone, he said.
“If this new industry takes hold and is successful, absolutely it is going to be contributing to the public treasury in the same way that it’ll be contributing to the overall economy [but] there is a great danger that state government is going to get greedy, and smother this emerging industry in its crib,” Mr. Taylor said.
Rendell spokesman Michael Smith countered that many other states have wellhead taxes of the kind the governor is considering and have nonetheless managed to keep the natural-gas companies from going elsewhere.
“We are among a handful of states that don’t have such a tax,” he said.
Bradley Vasoli can be reached at bvasoli@thebulletin.us
 |
 |
|
| A House Divided: Economic Stimulus Splits On Party Lines | Possible 'Inquirer' Bailout Draws Ire |
Reader Comments
The following are comments from the readers. In no way do they represent the view of thebulletin.us.
You must register with a valid email to post comments. Only your Member ID will be posted with the comments.
Registered users sign in here: |
Become a Registered User |
