Gov. Tom Wolf’s proposed budget increases spending for education, among other things, but with a looming deficit, that means finding new revenue sources.
Wolf has proposed reducing the types of industries who are currently tax-exempt, among them – the arts. Under the proposal, admissions to the performing arts, museums and historical sites would be taxed at 6.6 percent. While they haven’t taken an official stance on the proposal, the Greater Pittsburgh Arts Council (GPAC) said there are some questions.
“We’re concerned that an additional tax might depress demand, make it more difficult for those who may already have issue about access to the arts, make it more difficult for them to attend,” said David Pankratz, research and policy director for GPAC.
Other concerns include whether there would be a ripple effect from decreased ticket demand, how smaller arts organizations will manage a new tax and there are questions over how much revenue would actually be generated for the commonwealth.
“The impact generated if this tax were applied, based on current attendance, would be somewhere between $15 and $19 million depending on some definitions,” said Pankratz. “But the governor’s budget office came out and projected that the revenue would be more like $38.5 million, which is quite a disparity.”
Other areas that would see tax increases under the governor’s proposal include candy and gum sales, digital downloads, spectator sports and death services.
“We’re not alone,” said Pankratz. “There are lots of industries that might be affected so we’re trying to careful not to go overboard and say, ‘How unique, how we’re distinct totally from other kinds of areas,’ so keeping an open mind, also beginning to track how other industries are responding to this.”
GPAC is working with other area and statewide arts groups to continue to examine the issue and its effects on the arts in Pennsylvania.