Who Pays Pennsylvania’s Personal Income Tax?

Pennsylvania has a flat rate Personal Income Tax (PIT) of 3.07%, which is a fair and simple distribution of taxation.  Yet some people are imprudently calling for a state-wide graduated income tax, similar to the Internal Revenue Service (IRS).  In this blog series, I will highlight some real facts about Pennsylvania’s PIT.

Part 1: Distribution by Income Brackets

It might sound appealing to charge wealthier taxpayers a higher percentage of their income but the fact is wealthier taxpayers already provide a significant majority of taxable income for the PIT.  When taxable income is broken up by various population brackets it becomes apparent just how much more the wealthy contribute.

PA PIT - Pie Chart

For instance, according to 2006 income tax data the top 10% tax filers provided nearly 50% of total taxable income.  Conversely, the bottom 50% of tax filers only provided 10% of total taxable income. 

The pie chart on the right and data table below shows the total tax share held by various brackets based on the 3.07% rate.  As one can see, the current distribution is fair and simple.  In addition there is a tax forgiveness program not factored into the data which further aleviates struggling taxpayers.  There is no need to complicate the already fair and simple distribution of PIT. 

PIT - Data Set