In November, Pennsylvanians will choose the next governor, a post that steers the Commonwealth’s budget and determines how billions of taxpayer dollars are allocated. The contest pits Democrat Josh Shapiro who has overseen sizable increases in state spending since taking office in 2023, against Republican state treasurer Stacy Garrity who argues that the Commonwealth is overspending and needs broad tax reductions.
Shapiro’s fiscal trajectory since 2023
After winning the 2023 election, Governor Shapiro signed budget packages that lifted The education boost followed a Commonwealth Court decision that the existing school-funding formula violated the state constitution, prompting the administration to inject additional resources without a specific formula from the court.
Human services spending has surged because of an aging population and federal mandates tied to Medicaid. Pending federal cuts could force the state either to raise its own contributions or to taper benefits in the coming years. Rather than propose sweeping cuts, Shapiro has floated new revenue ideas—most notably the legalization and taxation of recreational marijuana and the regulation of skill games—but neither measure has cleared the legislature. As a result, the budgets he signed have drawn down cash reserves accumulated during the pandemic.
Shapiro’s administration also promoted economic-development incentives and regulatory reforms that it claims attract private capital. A spokesperson, Sam Reposa, summed up the governor’s stance: “Governor Josh Shapiro is working hard to make Pennsylvania a place where families can get ahead, businesses can grow, and good-paying jobs are within reach.” Recent legislation expanded the property-tax rent rebate, added a child-care tax credit, and introduced a state Earned Income Tax Credit-style deduction. When pressed about a potential broad-based tax increase, Shapiro insisted it is unnecessary, pointing to the billions of dollars still sitting in reserve.
Garrity’s tax-cut roadmap
Treasure Garrity frames the current fiscal path as “reckless spending” and proposes a series of tax reductions. She advocates eliminating the inheritance tax and cutting the 3.07% personal income tax by an unspecified amount. In a 2025 forum, she declared, “We need to unleash the private sector and rein in the public sector.” Her campaign also promises to cap school property taxes, require voter approval for any increase above one-half of 1% and lower local property taxes by one-third through expanded rebates. A constitutional amendment eliminating property taxes for residents 65 and older on fixed incomes, as well as for veterans and public-safety personnel, is also on the agenda.
Garrity has not detailed how she will offset the revenue loss from these cuts, other than pledging to hunt for fraud in the human-services budget, including Medicaid, citing a 2019 grand-jury report. Her spokesperson, Matt Beynon, argues that cutting taxes while trimming regulations—especially for agriculture and natural-gas sectors—will spark job growth and, paradoxically, raise
Skill-game taxation debate
Both candidates agree that the roughly 70,000 skill-game devices currently operating in bars, taverns and clubs should be regulated and taxed. Shapiro proposes a 52% tax rate, aligning with the 55% levy on electronic casino games, hoping to capture billions in untapped revenue. He warned, “We’re putting our communities at risk and losing out on billions of dollars in revenue by doing nothing.”
Garrity’s team supports taxation as well but suggests a lower rate, or alternatively a flat $500 monthly fee per machine, capped at 50,000 machines statewide—an approach favored by industry stakeholders. Beynon emphasized that the debate affects not only revenue but also venues that rely on these games, such as VFW halls and local restaurants.
Transportation and minimum-wage stances
Transportation funding remains a contentious arena. Shapiro’s first budget request asked the General Assembly to end the diversion of gas-tax proceeds to the State Police within five years, noting that Pennsylvania’s gas tax is the fifth highest nationally yet is eroding as electric and fuel-efficient vehicles rise. He also touted a reduction of 304 poor-condition bridges and $11 billion in state and federal road-repair funding. For mass transit, Shapiro sought a larger share of sales-tax revenue but failed to secure a Senate deal during the 2025 budget impasse.
Garrity, on the other hand, promises a moratorium on raising the gas tax and proposes a $750 annual rebate for licensed drivers 18 and older. She argues that federal transportation dollars should be fully leveraged, rural roads prioritized, and technology employed to streamline repairs. Regarding public transit, she would require agencies seeking state aid to demonstrate cost-saving measures and staff cross-training.
On the minimum-wage front, the state still follows the federal $7.25 floor, unchanged since 2005. Shapiro backs a bill to raise it to $15 an hour, arguing that higher wages would reduce Medicaid enrollment and bolster the economy. Garrity opposes the increase, suggesting that organic economic growth will naturally lift wages without government mandates.
Both campaigns have refrained from answering detailed questions about local-government tax authority for transportation or specific safeguards for gambling addiction tied to skill-game locations.
