February 25, 2015

Wolf Announces Key Economic Development Pieces Of His Budget

Gov. Tom Wolf Wednesday announced his 2015-16 Budget will include significant reforms aimed at three goals for economic development and creating good-paying, middle class jobs: creating a pro-growth business climate; building Pennsylvania’s manufacturing sector; and creating workforce partnerships for economic success.
“We need to rebuild the middle class, and we can do that by creating good jobs right here in Pennsylvania,” Gov. Wolf said. “For too long the Commonwealth of Pennsylvania hasn’t been a place where businesses want to come, invest and grow. Country-leading high corporate tax rates have slowed existing businesses from expanding and entrepreneurs from growing new ideas here.
“The Commonwealth can help set the table for robust private sector growth to create and retain good jobs while strengthening the middle class. In order to create jobs that pay and an economy that grows, we must acknowledge that success will require investment in our companies and our people, and a new business climate that is welcoming and fair.”
Pennsylvania’s economic prosperity has long been hobbled by an outdated tax structure that fails to incentivize job growth. The Governor’s plan will create a competitive climate to attract and retain jobs and businesses, and build strong, stable communities. This sweeping tax relief package includes:
— Reducing the Corporate Net Income Tax by half within two years flipping Pennsylvania’s ranking from second highest rate (9.99 percent) to the fourth lowest (4.99 percent);
— Eliminating the Capital Stock and Franchise Tax once and for all; and
— Closing loopholes through combined reporting to level the playing field for all Pennsylvania business.
Manufacturing has been at the heart of many communities and the growth of our middle class. Gov. Wolf’s Budget will build on that Pennsylvania tradition to create new, good-paying jobs by:
— Establishing a ‘Made In Pennsylvania Job Creation Program’ through a $5 million tax credit to be distributed to manufacturing companies that are creating good paying, middle class jobs; and
— Providing $5 million to the state’s Industrial Resource Centers to leverage the talents of our research universities to advance manufacturing technology and commercialization.
Pennsylvania’s educational and job training systems are too often disconnected from the state’s economy and employers struggle to find talent locally as a result. The 2015-16 Budget will take bold steps to address this challenge by increasing funding for:
— Programs that help Pennsylvanians gain targeted skills necessary to compete, including Industry Partnerships and Workforce and Economic Development Network of Pa. (WEDnetPA);
— Specialized technical education public post-secondary programs proven to deliver talent that Pennsylvania employers demand;
— Job-linked literacy programs that build employment skills that too many workers lack; and
— Vocational rehabilitation programs that help persons with disabilities prepare for, obtain and maintain employment.
Gov. Wolf will unveil the full details of his 2015-16 Budget on Tuesday, March 3, in front of the General Assembly.
Senate Majority Leader Jake Corman (R-Centre) issued the following statement following Gov. Wolf’s plans for corporate tax changes:
“While a significant reduction in the corporate net income tax sounds appealing, we cannot really assess Gov. Wolf’s proposal in the vacuum in which it is being presented. We need to see exactly how the $1.25 billion impact on the budget will be offset.
“At the same time, we support closing loopholes in our system, but proposals such as combined reporting can be problematic and actually unfavorable to our employers. We look forward to receiving and considering an entire package of specifics from the Governor not one idea floated at a time.”