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Pa. House says no, 193-0, to Gov. Wolf's tax plan

| Monday, June 1, 2015, 5:28 p.m.
“It’s time for bold change,” Gov. Tom Wolf tells a joint session of the state House and Senate in March. His $30 billion budget would raise income and sales taxes but cut property taxes, bridge a $2.3 billion deficit and increase education funding. The House unanimously rejected the proposal on Monday, June 1, 2015.
Sean Stipp | Trib Total Media
Pennsylvania Gov. Tom Wolf, shown here during an April interview with the Tribune-Review in Harrisburg, has vetoed the first bill to clear the General Assembly establishing a privatized liquor system in Pennsylvania. The bill would have phased out the state stores and allowed beer distributors and grocery stores with eateries to sell liquor and wine.

HARRISBURG — House Republicans called up Democratic Gov. Tom Wolf's tax-shifting plan on Monday, and the House shot it down by a unanimous vote.

Minority Leader Frank Dermody, D-Oakmont, called the vote on an amendment that contained Wolf's tax plan “a political stunt.”

“It does nothing to move this process forward,” Dermody said. “I would never ask (Democrats) to vote for a stunt.”

Wolf denounced the vote as “gamesmanship” and said it was an effort to “‘see if we can embarrass the administration.'”

But Majority Leader David Reed, R-Indiana County, said the vote gave the Wolf administration what it wanted: a vote on the entire tax package in his budget, rather than breaking it into pieces for individual votes.

“I think today is an accurate reflection if you consider the governor's budget” presented in March, Reed said.

Rep. Seth Grove, R-York County, said members based the vote on language built “word for word, sentence by sentence” on Wolf's budget proposal.

The plan includes billions of dollars in tax shifting to reduce property taxes and increase state spending. Wolf proposes taxing the extraction of natural gas from the Marcellus shale, raising cigarette taxes and taxing cigars and snuff. All told, GOP members said, it's a $4.7 billion tax increase.

“As has often been stated, this tax proposal encompasses everything from the cradle to the grave,” said Gene Barr, president of the Pennsylvania Chamber of Business and Industry, who supported the House vote.

The test vote on the Wolf budget was voted down 193-0.

“Gov. Wolf inherited a $2.3 billion deficit, woefully underfunded schools, a stagnant economy, and families across the commonwealth are struggling with high property taxes — the status quo is not acceptable,” said Wolf spokesman Jeffrey Sheridan.

Wolf's tax plan “makes the system fairer for middle-class families,” Sheridan said. It would “rebuild Pennsylvania's economy by fixing the deficit without gimmicks, funding education with a common-sense severance tax, rebuilding the middle class with investments in manufacturing.”

Republicans said they called Democrats on their effort to consider Wolf's spending proposals without revenue to pay for them. That's why they considered the amendment, GOP leaders said.

“They wanted to vote a spending plan without revenues,” said House Appropriations Chairman Bill Adolph, R-Delaware County.

Reed urged members to vote no, saying that might start real budget negotiations with the administration.

The budget is due by law June 30. Many lawmakers and lobbyists predict consideration of Wolf's $30 billion-plus budget will blow past the deadline.

Democrats telling their members to oppose a vote on political grounds doesn't discount the defeat, Reed said.

“You don't get to vote ‘maybe,'” Reed said.

Wolf wants to raise the income tax from 3 percent to 3.7 percent and the sales tax from 6 percent to 6.6 percent. He would expand the sales tax base to include a host of items such as diapers, newspapers, funeral services, legal work, textbooks, college room and board, and nonprescription drugs, Adolph said.

Though Wolf contends there's a $2.2 billion structural deficit to close, Reed said the fiscal picture has changed and it's $1 billion to $1.5 billion less than that.

Brad Bumsted is Trib Total Media's state Capitol reporter. He can be reached at 717-787-1405 or bbumsted@tribweb.com.

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