State Finances
How Pennsylvania collects and spends taxpayer dollars — budget, taxes, and fiscal health
$50.1B
General Fund Budget
FY 2025-26
$98.5B
Total w/ Federal
State + Federal
0.9%
Revenue Growth
IFO net forecast
5.1%
Spending Growth
Year over year
Budget at a Glance — FY 2025-26
Signed November 12, 2025General Fund
$50.09B
+5.1% vs. prior year
Structural Deficit
$5.1B
Spending exceeds revenue
Rainy Day Fund
$6.9B
Preserved — no withdrawals
The FY 2025-26 budget was signed after a 135-day impasse past the June 30 deadline. The gap between spending and revenue is covered by one-time sources — $1.5B in lapsed appropriations and $670M from surplus accounts — which will not be available next year. The IFO projects the structural deficit could grow to $8.4B by FY 2029-30 without policy changes.
Where the Money Comes From
State General Fund revenue by source. Personal income and sales taxes together account for over 60% of state tax revenue.
Flat 3.07% rate on all taxable income — wages, investments, business profits
6% statewide rate (7% Allegheny Co., 8% Philadelphia). Groceries & clothing exempt
7.99% rate, phasing down to 4.99% by 2031 to attract business investment
Tax on utility and telecom company revenues
$2.60 per pack of 20 cigarettes plus other tobacco products
1% state tax on real estate transfers (local rates additional)
0% spouse, 4.5% lineal descendants, 12% siblings, 15% others
Includes gaming, insurance premiums, motor license fees, liquor profits, and other sources
Nearly half the total budget comes from federal transfers — primarily Medicaid, education grants, and transportation funding. These funds are declining as pandemic-era programs expire.
Where the Money Goes
General Fund spending by category. Human Services and Education together account for over 70% of the budget. Hover or tap a category to see details.
- Medicaid projected at $54B total (state + federal)
- Community Health Choices +$622M
- Childcare and family services expansion
- +$920M for K-12 public education
- $565M in new adequacy funding
- Universal free breakfast continued
- Cyber charter reimbursement reform saves $175M
- Funding for 4 additional State Police cadet classes
- $80M+ for gun violence prevention
- Victims compensation program continued
- General obligation bond payments
- +$212M increase primarily for debt service
- $2.3B infrastructure improvement program
- Transit agencies receive $2.47B from sales tax & driver fees
- Bridge repair and road resurfacing across 67 counties
- Executive offices and administrative functions
- General Services cut $16M (residence remediation removed)
- State parks & forests cut 27% ($48M decrease)
- New Chesapeake Bay watershed funding
- DEP regulatory and permitting operations
- $500M site development funding continuing
- $100M for Innovate in PA 2.0
- $20M for minority-owned businesses (HDBP)
- Agriculture, judiciary, legislature, and miscellaneous
Pennsylvania Tax Rates
Corporate Tax Rate Phase-Down
PA is reducing its corporate net income tax rate by 0.5% per year from 9.99% (2022) to 4.99% (2031) to improve business competitiveness.
Fiscal Health Indicators
Explore the Data Yourself
OpenBookPA
Treasury's transparency portal — explore budget details, fund balances, agency contracts, and expenditures
www.patreasury.gov/openbookpa →
Independent Fiscal Office (IFO)
Nonpartisan fiscal analysis, revenue projections, economic impact reports, and 5-year outlook
www.ifo.state.pa.us →
PA Office of the Budget
Official enacted budget documents, appropriation details, and financial reports
www.budget.pa.gov →
PA Dept. of Revenue — Tax Rates
Current state tax rates, compendium, and filing information
www.pa.gov/agencies/revenue/resources/tax-rates →
PA Treasury — Budget Expenditures
Real-time expenditure tracking by department and fund
www.patreasury.gov/transparency/budget-expenditures.php →
Property Tax/Rent Rebate Program
Check eligibility for rebates — for seniors, disabled residents, and low-income homeowners/renters
www.revenue.pa.gov/IncentivesCreditsPrograms/PropertyTaxRentRebateProgram →
PA Municipal Statistics
Self-reported financial data from counties and municipalities — local taxes, budgets, and services
munstats.pa.gov →
School District Financial Data
Revenue and expenditure data for every PA school district, career center, and charter school
www.pa.gov/agencies/education/programs-and-services/schools/grants-and-funding/school-finances/financial-data.html →
About This Data
Financial figures reflect the enacted FY 2025-26 budget signed November 12, 2025, as reported by the PA Office of the Budget, PA Treasury, and the Independent Fiscal Office. Revenue and spending breakdowns are approximations based on published appropriation documents and may differ from final audited figures.
This page is for informational purposes only and does not constitute financial or tax advice. Consult official sources and qualified professionals for decisions affecting your finances.