Pennsylvania Democrats are planning to unveil a tax reform proposal that would cut taxes for a majority of Pennsylvanians and raise over $2 billion in new revenue, all while working around the state constitution’s uniformity clause that prohibits progressive income taxes on state residents.
The proposal, called the “Fair Share Tax Plan,” would split the state’s personal income tax into two parts — a tax on wages and tips and a tax on wealth. House Democrats introducing the proposal want to reduce the personal income tax on wages and tips from 3.07 percent to 2.8 percent and increase the personal income tax on wealth — which includes money from interest, dividends, net income, capital gains, royalties, winnings and more — from 3.07 percent to 6.5 percent.