January 05, 2016

Poll of accountants shows gloomy economic outlook in PA, NJ

Survey of almost 1,600 certified public accountants reveals concerns on taxes, pensions

Business Accounting
Angry Business Contributed Art/iStock

A poll of certified public accountants showed a gloomy economic outlook.

Accountants generally stay out of the limelight, but if you need an expert on a region's financial climate, they know what's going on. And according to a new poll of almost 1,600 certified public accountants in Pennsylvania and New Jersey, that climate is looking a little gray and stormy.

Only 24 percent of Pennsylvania accountants think that the business climate in their state is good, a huge drop from 41 percent last year. In New Jersey, however, the outlook is gloomier: only 15 percent believe that business is blooming in the Garden State. Admittedly, however, that number is not much different than in 2014.

For the poll, Franklin and Marshall College surveyed 753 members of the Pennsylvania Institute of CPAs and 843 members of the New Jersey Society of CPAs this fall. In both states, high taxes and pension funding were seen as the main issues affecting business growth at the state level, while government gridlock and federal regulations were blamed for slowing business at the national level.

The budget deadlock in Harrisburg no doubt contributed to Pennsylvanians' disgruntled outlook. Accountants from the Keystone State widely cited reforming state pensions was as a top priority, followed by reducing corporate taxes and state spending.

Despite the anti-tax sentiment, 43 percent of Pennsylvania accountants polled said they could support raising personal income taxes if the funds were earmarked for specific projects, such as infrastructure or property tax relief. The majority of them also approved of privatizing liquor stores and taxing natural gas drillers in the Marcellus Shale.

In New Jersey, the top priorities for reform were taxes, taxes and taxes. Accountants in the Garden State ranked cutting property, income and estate taxes as their top priorities for economic expansion.

However, after being told that New Jersey's Transportation Trust fund would soon "run out of money for road and bridge repairs," 66 percent of respondents agreed that the gas tax should probably be raised to fund infrastructure projects.

Ironically, while accountants see the economy as poor, many still feel confident that their clients will do well. Fifty-one percent of Pennsylvania CPAs and 45 percent of New Jersey CPAs predicted increases in business revenue; 57 percent of Pennsylvanians and 44 percent of New Jerseyans predicted that their clients' salaries would increase.