Press Release
Independent Fiscal Office Exposes Shapiro’s Overinflated Revenue Projections
Harrisburg, Pa., March 5, 2025 — Tuesday, the Independent Fiscal Office (IFO) released its analysis of revenue proposals contained in Gov. Josh Shapiro’s 2025–26 budget proposal.
This latest report confirms Shapiro’s revenue projections as wildly overstated. The IFO report evidences the governor’s proposal has overrepresented revenue projections by billions of dollars.
Moreover, the IFO detected hyperbolized projections throughout the governor’s budget proposal, particularly revenue estimates from mandatory combined reporting, taxes from legalizing recreational marijuana, and expanded gambling—none of which has been passed by the Pennsylvania legislature.
Shapiro misrepresents the true cost of his budget proposal, hiding a much larger deficit within falsified revenue streams.
Key Takeaways:
- Compared to IFO calculations, Shapiro’s Executive Budget overestimates the impact of his revenue proposals by $4 billion over the next three fiscal years.
- Shapiro’s estimate of revenue generated from taxing skill games is nearly double the IFO’s.
- The IFO’s estimate of generated revenue from proposed combined reporting requirements is one-third of Shapiro’s. Worse yet, the IFO warns that the combined reporting proposal could negatively impact revenue during fiscal year (FY) 2025–26.
- Though the IFO’s estimate of recreational marijuana legalization is higher than Shapiro’s in the long term, Shapiro’s FY 2025–26 estimate exceeds the IFO’s by $295 million.
Commonwealth Foundation Policy Analyst Andrew Holman issued the following in response:
“Governor Shapiro has once again overpromised and underdelivered—this time with his revenue projections.
“Even if Shapiro’s nonsensical projections come true, the cost to cover his $4.8 billion budget deficit is equivalent to a tax hike of $1,900 per family of four. As yesterday’s report reveals, the impact of Shapiro’s proposal on the existing deficit, and the tax increase to cover it, will be even higher.”
Commonwealth Foundation Chief Policy Officer Nathan Benefield continues:
“The governor’s proposal inflates revenue estimates to disguise the true cost of his unsustainable budget. By using unrealistic revenue numbers, Shapiro minimizes the devastating deficit his proposal would create.
“It is irresponsible to deceive citizens with a phony budget full of inflated projections from new taxes. Pennsylvanians deserve a balanced budget and honesty from their leaders. It’s shameful that Shapiro produced neither.”
Additional Resources:
Governor Shapiro’s 2025 Budget Proposal: An Extreme Spending Binge
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