2010-11 State Budget Wrap-Up
July 21, 2010

Hi, I’m Gene Barr. Welcome to this month’s Pennsylvania Chamber Minute.

The final month of session prior to the legislature’s summer recess shows what can be achieved when the business community delivers a consistent, coordinated message to policymakers.

Most notably, a state budget for the 2010-11 fiscal year was enacted without any broad-based tax increases on business, despite some who believe that burdening job creators is the way to get through tough economic times.

From the moment the governor delivered his budget address in February, PA Chamber members were adamant that adding to the tax burden of business would hurt private-sector job creation and the chances for economic recovery. As a result, the administration’s proposal to expand the sales tax base to include business services was quickly off the table. And in the end, lawmakers also rejected detrimental combined reporting; higher cigarette taxes; new taxes on cigars and smokeless tobacco; and a hastily enacted natural gas severance tax, which will be debated this fall.

Lawmakers also agreed to maintain the sales tax vendor collection allowance, which provides reimbursement to businesses for essentially serving as tax collectors for the state.

PA Chamber members thank elected officials for holding the line on taxes. We recognize that the program cuts contained in this budget are difficult. Yet, our members also know that government must begin to live within its means as individuals and families have had to do.

But there is no question that the business community’s pro-jobs, pro-growth message resonated with lawmakers, both during budget deliberations and in considering other bills moving through the process. Proposals that would significantly increase the cost of electricity and further deteriorate Pennsylvania’s already unbalanced legal system were kept at bay.