In the near future, I plan to introduce legislation that will modernize Pennsylvania’s tax structure by broadening the Sales and Use Tax (SUT) base while phasing out the Personal Income Tax (PIT) over time. This proposal aims to create a fairer, more sustainable revenue system that supports both taxpayers and economic growth.

This bill expands the SUT base to include several goods and services that currently remain exempt. In return for the SUT expansion, this proposal provides meaningful tax relief to working Pennsylvanians by gradually eliminating the Personal Income Tax with a gradual phase-down. The rate will decrease from 3.07% to 3.00% beginning in Tax Year 2026, and will be reduced by 0.5% annually thereafter, reaching 0% by 2032 and remaining at that rate for all subsequent tax years.

Additionally, the bill requires that any new interpretation of SUT exemptions be reviewed and approved through the Independent Regulatory Review Commission (IRRC) process. This change ensures that our vendors and taxpayers have a chance to participate in the regulatory process while also not being caught off guard by regulatory changes made internally by the Department of Revenue.

Furthermore, this legislation also eliminates the Accelerated Sales Tax (AST) filing requirement, an onerous burden for businesses, especially seasonal businesses who have irregular income cycles.

Recognizing the unique transportation needs of Pennsylvania’s largest cities, this proposal directs that any local SUT revenue collected in Philadelphia and Pittsburgh exceeding the 2025 base year amount be allocated to their respective mass transit authorities (SEPTA and PRT). These funds must be used solely for capital improvements, ensuring local reinvestment and infrastructure renewal.

Finally, this legislation represents a balanced approach to reforming Pennsylvania’s tax system, expanding the base to reflect today’s economy, simplifying administration, reducing reliance on income taxation, and investing in vital local infrastructure.

Please join me in co-sponsoring this important measure to provide lasting tax relief and create a stronger foundation for Pennsylvania’s fiscal future.