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In a move that has been met with both praise and criticism, Pennsylvania legislators have passed new taxation legislation for the upcoming year. The legislation, which was signed into law on November 22, 2025, includes several changes to the state's tax code that will impact residents and businesses alike.One of the key changes included in the new legislation is an increase in the state's personal income tax rate. Beginning in the 2026 tax year, individuals earning over $50,000 annually will see their income tax rate increase by 1%, while those earning over $100,000 will see a 2% increase. This change is expected to generate additional revenue for the state, which will be used to fund critical public services and infrastructure projects.In addition to the income tax rate increase, the new legislation also includes a tax on digital services. This tax will apply to services such as streaming platforms, online marketplaces, and app-based services, and is expected to generate significant revenue for the state. Critics of the tax argue that it will disproportionately impact low-income individuals who rely on these services for entertainment and essential needs.On the business side, the new legislation also includes changes to the state's corporate tax rate. The legislation includes a slight decrease in the tax rate for small businesses with annual revenues under $1 million, while larger corporations will see a slight increase in their tax rate. This change is aimed at leveling the playing field for small businesses and generating additional revenue from larger corporations.Overall, the new taxation legislation has been met with mixed reactions from Pennsylvania residents. Supporters argue that the changes are necessary to fund essential services and address budget shortfalls, while critics argue that the tax increases will place an undue burden on working families and small businesses. Only time will tell how these changes will impact the state's economy and residents in the coming years.