Corbett, Wolf run against history when talking taxes

TALKING TAXES can be taxing, especially when running for office.

Perhaps you recall what turned out to be troublesome tax-talk by Democrat Walter Mondale and Republican George H.W. Bush.

Well, we've got similar situations in Pennsylvania's race for governor.

Gov. Corbett last week told the Associated Press that he kept the no-new-taxes pledge he signed as a 2010 candidate.

Actually, he said, "I'm living up to my pledge the best I can."

Technically, true. Then again, he's presumably doing everything the best he can, which is why he's considered to be the most vulnerable incumbent governor in America.

But Corbett pledged not to raise taxes or fees, and he's done both.

Gas tax, tons of vehicle fees, impact fee on Marcellus drilling and delayed reduction of the capital stock and franchise tax that even business leaders who support him call a tax increase.

And although Corbett argues that his fuels tax really isn't a tax because it's tied to the price of gas, come on. We pay it. It brings the state revenue. It's a tax.

This arguably puts Corbett in the company of past GOP candidate Bush pere, who pledged in 1988, "Read my lips: no new taxes."

That helped Bush get elected. But taxes went up and Bush lost re-election.

Now, Corbett won't say that his pledge was a mistake (which it clearly was). But he does say that he won't make a pledge this time around (which is not to say he would raise taxes).

This gets us to Corbett's Democratic challenger, Tom Wolf.

He's also talking taxes: a severance tax on natural-gas extraction and a hike in the personal-income tax - for some. Doesn't say how many, doesn't say how much.

This arguably puts him in the company of past Democratic candidate Mondale who, in 1984, running against President Ronald Reagan, famously said: "Mr. Reagan will raise taxes, and so will I. He won't tell you. I just did."

Mondale lost in a landslide, carrying only his home state of Minnesota, which he won by less than 1 percent of the vote.

"I know the word 'tax' is something that shouldn't come up in any political campaign," Wolf tells me. But he says he's being open and honest: "I just want to make our tax system fairer."

Wolf talks of tax restructure.

He wants to change the personal-income tax - under which all earners pay the same rate regardless of how much they make - to what effectively would be a graduated, or progressive, tax varying with income.

(Most states have graduated rates. Pennsylvania's rate, 3.07 percent, is lowest among states with fixed rates. Six states - Florida, Nevada, South Dakota, Texas, Washington, Wyoming - have no state income tax.)

Wolf says his plan means less tax from those who make less, more tax from those who make more.

Problem here is twofold: The state Constitution includes a uniformity clause requiring tax rates to be applied, well, uniformly; and details of Wolf's plan are at this stage fuzzy.

Wolf suggests getting around uniformity by expanding an existing poverty "exemption," or tax credit. He'd apply "exemptions" to various income levels while keeping a flat rate, maybe 5 percent.

He says he "thought about" this as revenue secretary (2007-09) under Gov. Ed Rendell but is "not sure" why he or others didn't pursue it.

Wolf concedes that his plan would be challenged in court. He says he doesn't have data current enough to calculate its impact. And he says "I don't know" if the change he proposes would bring in the same revenue as the current system, although he'd also seek to close corporate tax loopholes to generate more revenue.

So, for both candidates, talking taxes presents some peril.

Can Corbett end up like Bush? Or will Wolf go the way of Mondale?

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