Tax Reform May Be Needed to Reverse PA Population Loss

Member Group : Center Square

(The Center Square) – Before the pandemic hit, Pennsylvania’s economy had been steadily growing for a decade – but not its population. The population loss has both political and economic consequences.

Federally, Pennsylvania’s influence will lag. The state lost a Congressional district thanks to net emigration from the state. The future of economic growth, too, may fall off as natives and would-be migrants from other states look to growing areas of the South and West.

One course of action to attract more people is tax reform.

“The Taxpayer Protection Act (TPA), House Bill 71 can lower our tax burden and improve our fiscal stability,” a fact sheet from the Commonwealth Foundation argued. “It places limits on how fast state government spending can grow. These limits would allow the state to build up its rainy day fund.”

Pennsylvania lost at least 30,000 people annually between 2013 and 2016, the Commonwealth Foundation noted. A bright spot has been international migrants, 274,000 of whom moved to Pennsylvania since 2010, helping to offset population losses.

“An influx of domestic migrants is crucial to the state’s economic future as the population continues to age,” the Commonwealth Foundation argued.

Low taxes can benefit businesses and workers alike, as does a low cost of living. That has benefited states like North Carolina, Arizona, and Texas, for example. The relatively lower cost of living in Philadelphia has also attracted people from New York City and other large cities on the East Coast. While staying in New York City or Washington, D.C. keeps many people renting, they can afford to buy a house in a city like Philadelphia or Pittsburgh.

Pennsylvania may also need to work on branding itself as a livable place, for cities and small towns in rural areas alike.

“If your city actually does have good jobs and the right kind of low cost of living, maybe the failure to attract and retain talent is a failure to tell your story in a modern, engaging way,” Dustin McKissen wrote for Governing magazine.

Staff Reporter

Anthony Hennen is a reporter for The Center Square. Previously, he worked for Philadelphia Weekly and the James G. Martin Center for Academic Renewal. He is managing editor of Expatalachians, a journalism project focused on the Appalachian region.