Raising More Income Tax Revenue Can Help Pennsylvania, Other States, Pursue a Stronger Economic Future

I’ve been with the Center for the past five years, and in the general line of work for more than 12 years overall, with a particular emphasis on the role that fair and adequate tax systems play in states’ overall success. [...] • And two, that maintaining adequate tax revenues is in itself vital to a state’s overall economic future, because it allows policymakers to both adequately support current public services like schools and infrastructure that undergird state economies today, and to pave the way for new investments that could further expand economic opportunity and enhance the state’s quality of life, thereby setti. [...] Of the five states that cut personal income taxes most deeply following the Great Recession of 2007-2009, in the years after, all five saw weaker overall GDP growth than the nation as a whole, while four also had slower growth in personal income and job creation.2 Even states that lack personal income taxes do not consistently outperform: the nine states with the highest top marginal income tax ra. [...] Indeed, 15 of the 20 major peer-reviewed studies published in academic journals in the 2000s and 2010s that examined the role of state personal income tax levels found little to no clear economic effects.4 Studies focusing on narrower issues, such as the impact of state tax levels on entrepreneurship, also find little to no impact. [...] 9 The importance of state policymakers prioritizing revenue in order to protect the economic foundations they have already built was perhaps most clearly evidenced by what happened in the wake of the Great Recession of a decade-plus ago — when crashing revenues across the states led to actions like sharp increases in college tuition, cuts in school funding, widespread public sector layoffs, and ot.