October 17, 2018

Pennsylvania: Who Pays? 6th Edition


PENNSYLVANIA

Read as PDF



PENNSYLVANIA STATE AND LOCAL TAXES

Taxes as Share of Family Income

Top 20%
Income Group Lowest
20%		 Second
20%		 Middle
20%		 Fourth
20%		 Next
15%		 Next
4%		 Top
1%
Income Range Less than
$19,100		 $19,100 to
$38,100		 $38,100 to
$62,200		 $62,200 to
$102,700		 $102,700 to
$228,700		 $228,700 to
$511,000		 over
$511,000
Average Income $11,600 $28,600 $49,400 $81,200 $142,600 $329,400 $1,327,500
Sales & Excise Taxes 6.6% 5.2% 4.4% 3.3% 2.4% 1.5% 0.7%
General Sales – Individuals 2.1% 2.0% 1.8% 1.5% 1.1% 0.7% 0.4%
Other Sales & Excise – Ind. 2.6% 1.6% 1.2% 0.9% 0.6% 0.3% 0.1%
Sales & Excise on Business 1.9% 1.6% 1.4% 1.0% 0.7% 0.4% 0.2%
Property Taxes 4.6% 2.6% 2.7% 2.8% 2.9% 2.7% 1.6%
Home, Rent, Car – Ind. 4.5% 2.4% 2.5% 2.7% 2.7% 2.2% 0.4%
Other Property Taxes 0.1% 0.1% 0.1% 0.1% 0.2% 0.4% 1.2%
Income Taxes 2.6% 3.8% 4.1% 4.2% 4.2% 3.7% 3.7%
Personal Income Tax 2.5% 3.7% 4.0% 4.1% 4.0% 3.5% 3.3%
Corporate Income Tax 0.1% 0.1% 0.1% 0.1% 0.1% 0.2% 0.4%
TOTAL TAXES 13.8% 11.6% 11.1% 10.3% 9.5% 7.8% 6.0%

Individual figures may not sum to totals due to rounding. Download the table

TAX FEATURES DRIVING THE DATA in Pennsylvania

Progressive Features

Regressive Features
  • Provides non-refundable “tax forgiveness” credit to low-income taxpayers
  • Sales tax base excludes groceries
  • Levies a state inheritance tax
  • Personal income tax uses a flat rate
  • Fails to provide a standard deduction or personal exemption
  • All retirement income is exempted from the personal income tax
  • Fails to provide refundable income tax credits to offset sales, excise, and property taxes
  • Fails to use combined reporting as part of its corporate income tax
  • Comparatively high cigarette tax

ITEP Tax Inequality Index

According to ITEP’s Tax Inequality Index, which measures the impact of each state’s tax system on income inequality, Pennsylvania has the 7th most unfair state and local tax system in the country. Incomes are more unequal in Pennsylvania after state and local taxes are collected than before. (See Appendix B for state-by-state rankings and the methodology section for additional detail on the index.)

Note: Figures show permanent law in Pennsylvania enacted through September 10, 2018, at 2015 income levels. Top figure represents total state and local taxes as a share of non-elderly income. The sixth edition of Who Pays does not include the impact of the federal deduction for state and local taxes (SALT) because policy changes in the 2017 federal Tax Cuts and Jobs Act temporarily limited the extent to which the SALT deduction functions as a generalized offset of state and local taxes.