During a virtual meeting last Friday, State Sen. Ryan Aument (R-Lancaster) joined the PA Chamber and members of the chamber of commerce community throughout the Commonwealth to discuss key legislative priorities, including House Bill 1219, tax code legislation that recently passed the state House of Representatives. (CLICK HERE to read our full statement on the bill’s passage).
Over the course of the call, Sen. Aument also shared an update on his policy initiatives related to energy and education, focusing on his pursuit of policies that will help promote economic mobility for all Pennsylvanians. What follows is a rundown of the major topics covered during the call:
Fiscal and Tax Code Reforms
Sen. Aument underscored his unwavering commitment to building upon the strides made with Act 53 of 2022, significant tax reform that included reducing Pennsylvania’s Corporate Net Income (CNI) tax rate. He emphasized the need for policymakers to remain vigilant, as other states are aggressively advancing similar initiatives to reduce their tax rates. The risk of not fully reaping the benefits of the Act 53 reduction if Pennsylvania lags behind was a point of concern raised often during Sen. Aument’s remarks. The issue of improving Pennsylvania’s treatment of Net Operating Losses (NOLs) also remains a priority for the session, with Sen. Greg Rothman (R-Cumberland) leading reform efforts in the Senate.
H.B. 1219 Advancements and Concerns
While the House recently passed legislation incorporating the Aument/Rothman tax reforms, the inclusion of mandatory combined reporting provisions raises significant concerns, constituting what PA Chamber President & CEO Luke Bernstein called a “poison pill.” Sen. Aument labeled these provisions as problematic at best and echoed Bernstein’s characterization at worst. The combined reporting and other provisions have torpedoed meaningful tax reform for years, and the Council on State Taxation (COST) states said these measures would make Pennsylvania’s corporate net income tax one of the most punitive and aggressive in the country.
A Fresh Perspective on Tax Cuts
According to Sen. Aument, a refreshing viewpoint emerged during floor debate on H.B. 1219, when House Democratic Leader Matt Bradford (D-Montgomery) advocated for rate reduction as a means of generating additional revenue. Aument acknowledged the pivotal role tax cuts play in bolstering Pennsylvania’s economic competitiveness and welcomed this perspective.
The Case for Tax Cuts
Aument emphasized the importance of advocating for tax cuts, framing it not as a question of affordability, but rather as an imperative for economic growth. He balanced this with the caveat that aggressive rate reduction must be accompanied by corresponding spending cuts. Moreover, Aument recognized that the annual budgetary process often presents an obstacle to pro-growth measures, calling for more of a big-picture understanding of the revenue-generating potential of rate reductions over the course of two-year cycles as well as in the long term.
Childhood Literacy: A Call to Action
Sen. Aument also highlighted the alarming decline in reading proficiency among third-grade students in the aftermath of the COVID-19 pandemic. Aument cited statistics indicating that a mere 34 percent of fourth graders currently meet the Commonwealth’s proficient reading standard, which has dire implications for the future of workforce development. He emphasized the pressing need for early diagnostic testing, increased resources, and the adoption of effective teaching methodologies like phonics to reverse this startling trend.
A Unified Front for Economic Competitiveness
Sen. Aument proposed the formation of a bipartisan pro-growth caucus, envisioning it as a vehicle to galvanize support for these initiatives and foster collaboration among lawmakers.
Navigating a Challenging Political Landscape
Aument acknowledged the unpredictability and challenges presented by the current political climate in Harrisburg. Nevertheless, he expressed determination to forge ahead with the work at hand.
Hydrogen Hubs and Energy Policy
Aument expressed optimism regarding the potential benefits of hydrogen hubs and stressed the need for a comprehensive energy plan prioritizing reliability, affordability, and economic growth. He advocated for the establishment of an independent energy office to navigate this crucial policy area, which he compared to the Commonwealth’s Independent Fiscal Office.