Pennsylvania: Stay Strong in Opposition to Tax Hikes 

To: Members of the Pennsylvania Senate

From: Americans for Tax Reform

Re: Stay Strong in Opposition to Tax Hikes 

On behalf of Americans for Tax Reform (ATR) and our supporters across Pennsylvania, I urge you to continue to avoid tax increases as you negotiate a budget agreement. 

We applaud the Senate’s passage of a budget that includes no tax increases, Senate Bill 160, and the Senate majority’s very strong statement that the plan “continues to meet the Senate Republican requirement of imposing no tax hikes on Pennsylvania families.”

The Governor’s $52 billion budget proposed an unsustainable spending increase that sets the table for tax hikes. The Democrat Governor and House win if Republicans participate in approving a tax hike. They can call any tax hike “bipartisan” in such a scenario. 

While legalizing an activity, like skill games, and applying a reasonable tax rate may not qualify as a tax increase. Other proposals that various Democrats have proposed, and that may be coming up in discussions are tax hikes. 

An increase to sports betting or other gaming tax rates would be outrageous and irresponsible. Pennsylvania’s sports betting tax is nearly the highest in the nation already at an effective 36% rate; the iGaming rate is the highest in the country at 54%. 

Excessive tax rates on gaming promote illegal black market betting. This supports criminal networks and activity. 

Recent numbers show taxable sports betting revenues fell almost 50% year over year between 2024 to 2025, and the state collected less revenues than the prior two months. The state’s high taxes are not helping anyone, and the economic growth and job creation from the industry would clearly be under threat if taxes were even higher. 

Democrats have also proposed a regressive digital ad tax. Costs would be passed down to consumers, and make running a small business more difficult, regardless of where the tax is aimed. 

Additionally, Democrat tax plans have included taxes on cannabis, as well as redirecting the sales tax towards transit funding. They have proposed the idea of a rideshare tax on companies such as Uber. The proposed plan would tax citizens who choose to use alternative methods of transportation, at the expense of a transit system that has fallen into mismanagement in recent years. 

These, and any other tax hikes are bad policies, and a trap. Republican participation in a tax hike would grant Democrats their wish on additional spending and violate our shared principles. 

Voters ensured Republicans maintained control of the Senate knowing their brand was an anti-tax increase brand. A dozen Republicans in the legislature have taken the Taxpayer Protection Pledge, the written commitment to their voters that they will oppose all tax hikes. 

We strongly support the Republicans’ fight against reckless spending and tax increases, and appreciate the incredibly difficult position the budget standoff is placing you in. If ATR can be of any assistance as you continue to work on the budget, please do not hesitate to reach out to me, or State Projects Director Doug Kellogg at 202-785-0266 or dkellogg@atr.org. 

Sincerely,

Grover Norquist

President

Americans for Tax Reform