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Free-market group: Wolf’s budget would cost families $1,400

By   /   March 10, 2015  /   No Comments

By Andrew Staub | PA Independent

HARRISBURG, Pa. — Louise Bell is 90, she has dementia and has lived in a nursing home for five years. She gets Social Security, but most of her money came from selling her home of six decades, said her son, Kermit.

Gov. Tom Wolf’s budget proposal would test that fixed income. He wants to raise the state’s sales tax and broaden its base to include services such as nursing care, which Kermit Bell said would cost his mother $3,000 a year.

“If she were actually able to understand what’s happening, it would be very upsetting. Very upsetting,” he said. “She’d probably be put on meds.”

Andrew Staub/PA Independent

ANOTHER MONTH: Palmyra resident Kermit Bell said a higher sales tax would add $3,000 to his mother’s nursing care costs, enough to pay for a full month.

The budget is a longshot to pass in a General Assembly with big Republican majorities, but that hasn’t stopped some groups from raising alarms about higher taxes. Matthew Brouillette, president and CEO of the Commonwealth Foundation, a free-market think tank, pointed to the Bells’ story as an example of how Wolf’s budget could hurt families.

The think tank’s analysis found the plan — which also pairs property tax relief and a reduced corporate net income tax with a higher personal income tax, a severance tax and higher taxes on tobacco products — would cost a family of four an average of $1,419 in the next fiscal year. Brouillette illustrated the findings with tables full of diapers, salad dressing, canned tuna and more.

“This right here next to me is what $1,400 in lost grocery and household items looks like today,” he said. “This, right here, is what Mr. Wolf wants to take away from middle-class families.”

Jeffrey Sheridan, Wolf’s press secretary, disputed the Commonwealth Foundation’s claim. He called the figure “wildly inaccurate” and accused the think tank of arriving at the number deceptively, so that it could attack Wolf.

“The Commonwealth Foundation is a highly partisan organization that pretends like they’re a policy organization,” Sheridan said, adding the group did not account for property tax relief in its calculations.

But the think tank did account for property tax relief. It just didn’t include any for the 2015-16 fiscal year. Wolf would not start the relief until the 2016-17 fiscal year, but the state would begin collecting money to fund it the year before.

“It is really simple mathematics: Governor Wolf would raise taxes by $4.5 billion in 2015-16 and provide homeowners with precisely $0 in property tax relief,” Brouillette said.

The Commonwealth Foundation considered household incomes when doing its calculations, looking at the situation through a per-capita lens. An average figure means some families could pay more, and some could pay less.

Income plays a factor when considering Wolf’s budget proposal, which the administration has said would make the state’s tax structure fairer and would leave the average family with a 13 percent net tax cut.

Families of four who own a home and make $36,000 would see the most relief, according to the administration. They would receive a 70 percent net tax cut. Relief would be less pronounced for families earning more but, Sheridan said, even households with an income of up to $100,000 would get a break. At that level, though, savings reach just $7.

“Well, they’re not paying more,” Sheridan said.

The details will be vetted further during the General Assembly’s budget hearings, which began Monday and continue through the month.

So far, Democrats have lauded Wolf’s plan to ramp up education funding while providing some property tax relief, while Republicans that control the Legislature have painted him as a stereotypical tax-and-spend Democrat.

“I believe that the citizens of Pennsylvania can better decide how to spend their money than the government can. After all, they’re the ones who have earned it,” state Rep. Fred Keller, R-Snyder, said during the Commonwealth Foundation’s presentation.

Like the Bells, Micah and Abby Dunn would be among the families with financial decisions to make if taxes increase.

The Dunns started a chiropractic business in 2013, and they’d have to grow by 25 percent to break even under Wolf’s plan, Micah Dunn said. They’re already making tough decisions about preschool and whether to have their children play T-Ball, he said.

“This hits pretty hard,” Micah Dunn said of the budget proposal.

Brouillette zeroed in on those “real-life” examples while brushing aside Sheridan’s criticism that his organization was using distorted figures to attack the governor.

“As for Mr. Sheridan’s ad hominem attacks,” Brouillette said, “they are the last refuge of those trying to defend Mr. Wolf’s indefensible attack on middle class families like the Dunns and the elderly like Louise Bell.”


Andrew formerly served as staff reporter for