Today, Governor Tom Wolf announced that Pennsylvania has collected a record $43.9 billion in revenues for the 2021-22 fiscal year. Gov. Wolf wants to use this revenue to make major investments in improving life and lowering costs for Pennsylvanians.
In May, Pennsylvania collected $3.2 billion in General Fund revenue, which was $402.4 million, or 14.2 percent, over estimate. Fiscal year-to-date General Fund collections total $43.9 billion, which is $4.9 billion, or 12.5 percent, above estimate.
“Right now, Pennsylvania has $4.9 billion in the bank over and above what we expected to bring in this year. That’s a big pot of money, and I want to use it to lower some of the barriers that keep Pennsylvanians from succeeding,” said Gov. Wolf. “We have the money in the bank to pay for the historic investment I want to make in K-12 education, as well as the Corporate Net Income Tax cut and reforms I have proposed to bolster Pennsylvania businesses, and still have $1.8 billion left over,” said Gov. Wolf. “At a time when Pennsylvanians are hurting and state government is not, there is no excuse not to use this huge pot of money to improve education, lower costs for taxpayers, and build a stronger economy. Investing in Pennsylvanians is how we guarantee future success for Pennsylvania.”
Over the past seven years, the Wolf Administration has righted Pennsylvania’s shaky finances through sound fiscal management. When Gov. Wolf took office, Pennsylvania was operating with a $2-3 billion budget deficit, and the Rainy Day Fund had fallen to a mere $231,800.
Today, the Rainy Day Fund contains a record $2.8 billion – more than 12,000 times what it was when Gov. Wolf took office – to protect Pennsylvania against future emergencies. The Rainy Day Fund is entirely separate from both Pennsylvania’s $4.9 billion surplus this year and the $2.1 billion in remaining federal American Rescue Plan funding that Pennsylvania must obligate by 2024 or lose.
The Governor’s plan to invest in lowering costs for Pennsylvanians is balanced based on recurring General Fund revenue and does not rely on one-time funding sources. Over the past seven years, revenues have grown an average of $2.2 billion per year, and data forecasts from nationally recognized economic forecasting firms Moody’s Analytics and IHS Markit point to continued tax revenue growth for the commonwealth.
Based on the latest revenue estimates, even if the governor’s proposed budget were implemented in its entirety, Pennsylvania would still have a multi-billion dollar General Fund balance at the end of 2022-23.
“Pennsylvania has taken in record revenues this year,” said Gov. Wolf, “and I want to take that money and invest it right back into the people of Pennsylvania by making our education system the best in the nation. This is an investment in a better future for all Pennsylvanians – one where students have the resources to succeed and workers have the skills to support themselves and their families. To ensure our economy continues to grow in the future, we need to invest in our next generation of workers, leaders and innovators.”
See below for a further breakdown of May revenue collections:
Sales tax receipts totaled $1.2 billion for May, $129.1 million above estimate. Year-to-date sales tax collections total $12.7 billion, which is $1.0 billion, or 8.7 percent, more than anticipated.
Personal income tax (PIT) revenue in May was $1.1 billion, $126.9 million above estimate. This brings year-to-date PIT collections to $16.5 billion, which is $2.2 billion, or 15.2 percent, above estimate.
May corporation tax revenue of $510.9 million was $129.5 million above estimate. Year-to-date corporation tax collections total $6.3 billion, which is $1.2 billion, or 24.4 percent, above estimate.
Inheritance tax revenue for the month was $132.3 million, $15.6 million above estimate, bringing the year-to-date total to $1.4 billion, which is $159.8 million, or 12.6 percent, above estimate.
Realty transfer tax revenue was $69.3 million for May, $13.9 million above estimate, bringing the fiscal-year total to $771.1 million, which is $153.9 million, or 24.9 percent, more than anticipated.
Other General Fund tax revenue, including cigarette, malt beverage, liquor and gaming taxes, totaled $176.3 million for the month, $3.1 million below estimate and bringing the year-to-date total to $1.6 billion, which is $16.5 million, or 1.1 percent, above estimate.
Non-tax revenue totaled $29.7 million for the month, $9.4 million below estimate, bringing the year-to-date total to $4.6 billion, which is $112.9 million, or 2.5 percent, above estimate.
In addition to the General Fund collections, the Motor License Fund received $301.1 million for the month, $10.7 million above estimate. Fiscal year-to-date collections for the fund – which include the commonly known gas and diesel taxes, as well as other license, fine and fee revenues – total $2.6 billion, which is $30.3 million, or 1.2 percent, above estimate.