Report shows how Pennsylvania will be impacted by ‘Big Beautiful Bill’

(WHTM)– President Donald Trump’s “Big Beautiful Bill” will cut federal taxes for average Pennsylvanians, but there is concern that certain provisions will also cut revenues to state coffers.

A new report by Pennsylvania’s Independent Fiscal Office (IFO) raises red flags for this fiscal year, which is not good news for legislators trying to hammer out a state budget that is approaching two months overdue.

The IFO estimates that Pennsylvania will take around $700 million less than it was counting on in corporate net income taxes. This stems from a provision on the budget bill that allows them to accelerate depreciation.

If businesses take advantage, it is nearly a quarter-billion-dollar hole that the state has to find elsewhere.

Director of the Pennsylvania Independent Fiscal Office, Matthew Knittel, said, “We wanted to get this data out in front of the the negotiators, in front of the members of the General Assembly, the governor’s office, so they can include it in their expectations of, you know, how much money we’re going to get this fiscal year.”

Businesses believe lower taxes mean they have more to spend on increased salaries or expansion, which would positively impact the economy.

The IFO estimates that Pennsylvanians will get $2.5 billion in federal tax cuts. A significant portion of this will be spent, which will increase sales tax revenues by $80 million.

However, with the state budget at a standstill and other uncertainty from Washington, making up a $700 million hole in corporate net income taxes is not welcome news.