Pennsylvania’s ‘Fair Share’ Tax Idea Would Draw Legal Scrutiny

A tax proposal under consideration by a Pennsylvania House panel would likely draw state constitutional challenges, lawmakers heard Friday.

The Finance Subcommittee on Tax Modernization and Reform is considering HB 1773, also known as the “Fair Share Tax Plan.” The measure would change the state’s flat income tax rate of 3.07% to a rate of 1.9% on wages and interest and 12% on several forms of passive income, including dividends, royalties, and gambling and lottery winnings.

State Rep. Chris Rabb (D), the plan’s sponsor, said the proposed policy change would promote fairness and generate about $6.2 billion in new ...