The Pennsylvania Cost of 2026: How New Laws Will Hit Your Wallet

Here is a breakdown of the most impactful ways the "Pennsylvania Cost of 2026" will hit your wallet this January.

1. The Regional Minimum Wage Jump

For the first time in 15 years, Pennsylvania is breaking away from the federal $7.25 minimum wage. However, your new "payday" depends entirely on your zip code due to a new tiered regional system.

• The $15/Hour Tier: If you work in Philadelphia, the minimum wage officially jumps to $15 per hour on January 1st.
• The $12/Hour Tier: In 19 populous counties—including Allegheny, Bucks, Delaware, Lancaster, and Montgomery—the wage increases to $12 per hour.
• The Rural Tier: For the rest of the state, the floor rises to $10 per hour.
• Tipped Workers: The tipped minimum wage is also surging to 60% of the new county minimum wage ($9.00 in Philly), providing a massive boost for service-industry staff.

2. Skyrocketing Electric Bills (The PJM Impact)

Many Pennsylvanians will see a "hidden" cost on their utility bills this winter. Due to record-high prices in the regional electricity capacity auction (PJM), the cost of ensuring power grid reliability has surged.

• The Surge: Estimates suggest Pennsylvania energy consumers could face a collective $2.18 billion increase in electric bills through the 2025-2026 planning year.
• The Bill: While your "distribution" rate (what you pay your local utility to deliver power) might stay the same, the "generation" portion of your bill is expected to rise as these auction costs are passed down to consumers.

3. ACA Health Insurance Premium Hikes

For those who purchase their own health insurance through the state marketplace (Pennie), 2026 brings a double-whammy of rising costs.

• The Rate Hike: The Pennsylvania Insurance Department has approved average premium increases of nearly 22% for the individual market for 2026.
• Subsidy Cliff: The federal "enhanced" tax credits are currently set to expire. Without these subsidies, some middle-income Pennsylvanians could see their monthly premiums double, as the financial assistance that previously capped costs is reduced.

4. Corporate and Small Business Tax Shifts

The state is continuing its multi-year plan to make Pennsylvania more business-friendly, but some local exemptions are set to expire.

• CNIT Phasedown: The Corporate Net Income Tax officially drops to 7.49% for 2026, part of a plan to reach 4.99% by 2031.
• Philadelphia Exemption Expiry: Small businesses in Philly face a specific hit; the long-standing $100,000 BIRT (Business Income and Receipts Tax) exclusion is expiring, and the $2,000 Use & Occupancy (U&O) Tax exemption disappears on January 1st.

5. New Healthcare Savings: Breast Cancer Screenings (SB 88)

While premiums are rising, a new law taking effect in late January provides a vital financial shield for women's health.

• Zero Cost-Sharing: Senate Bill 88 prohibits insurers from charging any out-of-pocket costs (copays or deductibles) for supplemental breast cancer screenings.
• The Benefit: If a standard mammogram shows an abnormality, follow-up MRIs or ultrasounds must now be provided at no cost to the patient, removing a significant financial barrier to early detection.

Looking Ahead: The CROWN Act (Jan 24)

Later in the month, the CROWN Act officially takes effect, making it illegal for employers or schools to discriminate against individuals based on hair texture or protective hairstyles like braids, locs, and twists. This landmark civil rights update ensures that Pennsylvanians' professional opportunities aren't limited by their cultural expression.