Pennsylvania Senate approves tax cuts on electricity and school supplies, targets data centers
The Pennsylvania Senate has approved a bill that includes tax cuts on electricity and school supplies, while also proposing to remove a sales tax exemption for data centers. The bill, House Bill 1667, now returns to the House of Representatives for consideration. Democrats warn the measure could create a $1.7 billion hole in the state budget.
The Pennsylvania Senate has advanced House Bill 1667, a measure primarily focused on cutting taxes on electricity and school supplies, which also includes a provision to eliminate a sales tax exemption for data centers. The bill, approved by the Senate, now returns to the House of Representatives for further deliberation. Republican senators, including Sen. Scott Martin (R-Pa. Dist. 13), praised the bill as a historic step that would lower consumer costs on electric bills and provide a two-week sales tax holiday for school supplies, along with directing $25 million to the state's Educational Improvement Tax Credit program.
However, Democratic senators have raised significant concerns, warning that the bill could create a $1.7 billion deficit in the state budget. Sen. Lindsey Williams (D-Pa. Dist. 38) criticized the bill as a "political stunt" that might offer minimal savings while causing substantial losses to the general fund. The proposed removal of the sales tax exemption for data centers, originally introduced in 2022 to stimulate industry growth in Pennsylvania, signals a shift in the state's approach to incentivizing the sector. Sen. Jay Costa (D-Pa. Dist. 43) acknowledged the potential positive impact on electric bills for consumers, while Sen. Wayne Langerholc (R-Pa. Dist. 35) emphasized the bill's role in delivering "real, immediate relief" to families. The future of House Bill 1667 now rests with the House of Representatives.