HARRISBURG - Pennsylvanians have consistently identified the economy as one of the top issues influencing their choice in the 2022 governor’s race.

Attorney General Josh Shapiro, the Democratic nominee, and state Sen. Doug Mastriano, a Republican representing Franklin County, agree that Pennsylvania needs to cut red tape, lower business taxes, and direct more funding toward the state’s roads and bridges.

As governor, Mastriano says he would focus on restoring Pennsylvania’s status as a “manufacturing powerhouse,” and work to bring tens of thousands of “good-paying, blue-collar jobs” to the state.

Shapiro argues that Mastriano’s views on social issues, including his support for a ban on abortions after roughly six weeks of pregnancy, would cost the state jobs.

At a recent candidate forum organized by the Pennsylvania Chamber of Business and Industry, Shapiro said Mastriano’s stances on abortion, marriage equality, and climate change would “make it harder for every employer in this room to be able to attract the kind of talent that we need.”

In June, the CEO of Duolingo, a tech company headquartered in Pittsburgh, said the company would have to grow elsewhere if Pennsylvania made abortion illegal.

Business taxes

For years, Pennsylvania had the second-highest corporate net income tax rate in the U.S., and lawmakers in Harrisburg couldn’t agree on a way to lower it. Business leaders complained that the high tax rate kept Pennsylvania from being able to lure companies here from other states and stifled job growth.

This year, the stalemate ended. Wolf and state lawmakers agreed to lower the tax rate by one percentage point starting in January; it will then keep dropping by 0.5 percentage points each year until it reaches 4.99% in 2031. That would make Pennsylvania’s tax rate the ninth-lowest in the country, compared to other current rates, according to the Tax Foundation, a Washington, D.C., think tank.

Mastriano and Shapiro both support the change but want the tax rate to be cut further and faster. Shapiro says it should be reduced to 4% by 2025. Mastriano wants to lower it to 2.4% by 2026 - or by 2030, if lawmakers won’t agree to cut it more quickly. Mastriano’s plan would make Pennsylvania’s tax rate the lowest in the nation, according to a Tax Foundation comparison of state rates as of July.

The tax cut that passed the General Assembly this year, combined with other tweaks to the tax code, will cost the state $202 million in foregone revenue in the next fiscal year, according to a legislative analysis. Cutting it further would cost even more.

A spokesperson for Shapiro’s campaign said the tax cut could be offset by Pennsylvania’s billions of dollars in surplus, and that lower business taxes would lead to significant economic growth, boosting state tax revenues overall.

Mastriano told Spotlight PA in response to written questions that the tax cut would bring new businesses and workers into the state, so the revenue loss would be “negligible.”

Regulation

Another point of agreement between the two candidates: Pennsylvania needs to cut the red tape that businesses run into when dealing with state government.

Mastriano plans to eliminate at least 55,000 state regulations in his first 100 days in office. He’s also said he’d work with the General Assembly on legislation that would automatically review all regulations that cost more than $1 million and eliminate two regulations for any new regulation created.

Mastriano also says he would make the state’s permitting process more transparent by signing legislation that would create a tracking system for applications, allow for third-party reviews of delayed decisions, and “deem approved” permits that aren’t decided on within 45 days.

Shapiro has spoken about the need for state government to develop a “yes mentality” when working with businesses. “Too often the attitude of state government is ‘no, you can’t’ and we need to flip that around,” he said in an interview with the PennLive editorial board earlier this month.

Shapiro says he would create a “one stop shop” in the governor’s office to help businesses navigate the process of applying for state permits, licenses, and grants. On his first day in office, he plans to sign an executive order that would require state agencies to give applicants a response deadline; if the agency doesn’t respond in time, the application fee would be refunded.