Philadelphia, PA - Pennsylvania, located in the Great Lakes, Northeast, and Mid-Atlantic areas of the nation, is the fifth most populated state in the US. Its 46,055 square miles make it the thirty-third-largest state in terms of area in the United States. But it is also steadily becoming an economic juggernaut. Let's talk about the main players in Pennsylvania’s economy.
Pennsylvania’s Biggest Industries
Since the state's founding in 1682, agriculture has played a vital role in Pennsylvania's economy. Native Americans from the Lenape and Monongahela tribes established agriculture in Pennsylvania. While the Monongahela people cultivated squash, corn, and beans in the Upper Ohio Valley, the Lenape people planted corn in Delaware.
Over 9.47% of the workforce in Pennsylvania was employed in the manufacturing sector in 2018, which contributed 11.89% of the state's overall output. In 2018, the manufacturing industry earned $93.75 billion in total. In 2017, there were around 569,000 people employed in the manufacturing industry of Pennsylvania, and the average yearly wage was $73,730. In the manufacturing industry in 2017, some of the most profitable segments included chemicals, food processing, metal goods, equipment, electronic devices, and computers.
Pennsylvania is the biggest coal producer in the nation and the only state in America to produce anthracite coal. Pennsylvania has historically played a significant role in the coal mining industry, notably in the Northumberland, Schuylkill, Carbon, Luzerne, Columbia, and Lackawant regions. The largest known anthracite coal resources on the continent are found in Pennsylvania.
Tax Revenues Over the Past Few Years
Corporate Net Income Taxes
2019-2020 - $2,827,211,927
2020-2021 - $4,424,350,740
2021-2022 - $5,323,493,518
As you can see, corporate net income taxes almost doubled over the past three years, which says a lot about the growth of the industry. It seems like the government is going to lower the tax rate to make the industry even more competitive and allow more businesses to flourish.
2019-2020 - $143,022,017
2020-2021 - $241,833,709
2021-2022 - $307,857,135
The gaming industry in Pennsylvania swiftly bounced back from the pandemic era. According to recent research from the Allegheny Institute for Public Policy, the industry's total revenues reached $3.2 billion in 2018 and it is anticipated to surpass $5 billion in 2022.
2022 took off with significant growth for the gaming industry in Pennsylvania. According to Frank Gamrat, executive director of the Allegheny Institute, the business might bring in $2 billion in taxes for the Commonwealth.
Personal Income Tax
2019-2020 - $12,835,482,000
2020-2021 - $16,283,765,087
2021-2022 - $18,125,871,118
Personal income tax revenue experienced excellent growth as well. Revenue from personal income taxes in June of 2022 totaled $1.6 billion, $179.8 million more than anticipated. Total PIT receipts for the fiscal year have already surpassed expectations by $2.4 billion, or 14.9%.
Inheritance & Estate Taxes
2019-2020 - $1,082,045,304
2020-2021 - $1,345,499,598
2021-2022 - $1,550,428,536
Inheritance and estate taxes grew at a great rate (around 30%) over the past three years. For an inheritance to direct descendants (lineal heirs), the tax rate is 4.5%; for transfers to siblings, it is 12%; and for transfers to other heirs, it is 15% (except for exempt institutions, charitable organizations, and government entities that are exempt from tax).
The state of Pennsylvania is experiencing stunning growth. Lowered tax rates allowed the main industries to flourish, providing more business opportunities and more tax revenue. Pennsylvania might be the new economic miracle of the US.