Making Pennsylvania more affordable means creating an environment where small businesses feel empowered to invest, hire, and grow, Neal Lesher, the PA Chamber’s vice president of government affairs, told lawmakers during a Sept. 1 hearing on affordability.

Testifying before the House Republican Policy Committee, Lesher outlined several reforms the PA Chamber believes would help small employers keep more capital in their businesses while making the Commonwealth more competitive for investment and job creation. His testimony focused on tax reform, regulatory simplicity, and legal changes aimed at reducing costs that can be particularly challenging for smaller employers.

“For businesses, cash is like water,” Lesher told lawmakers. “It flows to the least restrictive place.”

Tax Reforms Could Help Small Businesses Grow

A major focus of Lesher’s testimony was advocating to improve Pennsylvania’s tax climate.

Among the reforms supported by the PA Chamber are accelerating the state’s scheduled Corporate Net Income Tax reduction, expanding Net Operating Loss deductions for small businesses, adopting a state and local tax deduction workaround, increasing the vendor discount, and eliminating accelerated sales tax payments.

These policies would give employers greater flexibility to reinvest in their operations, whether through hiring additional workers, purchasing equipment, expanding facilities, or building cash reserves during periods of economic uncertainty.

Lesher noted that Pennsylvania has made substantial progress since lawmakers began reducing the Corporate Net Income Tax in 2022, but said additional reforms are needed to strengthen the Commonwealth’s competitive position.

Complexity Carries a Cost

Beyond tax rates, Lesher emphasized the burden that complex tax and regulatory requirements can place on small businesses.

For many of these employers, complying with state requirements often means relying on outside accountants, attorneys, and other professional services – which can consume resources that might otherwise be used to grow the business, increase wages, or invest in new opportunities.

The PA Chamber has long argued that a simpler, more predictable tax and regulatory system would lower costs, reduce administrative burdens, and make it easier for entrepreneurs and small-business owners to focus on running their businesses.

Affordability Includes Legal Reform

Lesher also urged lawmakers to consider Pennsylvania’s legal environment as part of the affordability conversation.

The Chamber contends that litigation costs can contribute to rising insurance premiums and other business expenses, creating additional financial pressure for employers. Those costs can be especially difficult for small businesses, which often have fewer resources to absorb unexpected legal or insurance-related expenses.

“I really don’t think you can have a conversation on affordability in Pennsylvania without at least touching on lawsuit abuse reform,” Lesher said.

The Chamber maintains that legal reforms that discourage abusive litigation while preserving access to the courts can help improve Pennsylvania’s business climate and reduce unnecessary costs.

Building a More Competitive Environment for Entrepreneurs

For the PA Chamber, Lesher’s testimony reinforced a central message: policies that support small businesses are closely tied to affordability and economic growth.

The Chamber believes helping employers keep more of their earnings, reducing compliance burdens, and addressing legal costs would allow small businesses to invest more confidently in Pennsylvania. In turn, those investments can support job creation, strengthen local communities, and make the Commonwealth a more attractive place to do business.

As lawmakers continue debating affordability initiatives, the PA Chamber is encouraging policymakers to ensure that small-business competitiveness remains a key part of the discussion.