Gov. Tom Wolf holds his first press conference

Pa. Gov. Tom Wolf holds his first press conference in the Governor's Reception room in the State Capitol on Feb. 5, 2015. On Tuesday, March 3, he'll unveil his first budget proposal. Mark Pynes | mpynes@pennlive.com

(Mark Pynes | mpynes@pennlive.com)

What: Gov. Tom Wolf will unveil the first budget of his administration, and the bits and pieces that are coming out are promising that Wolf will be shaking things up with a budget that, if approved by the legislature, would dramatically change the state's taxing and spending landscape.

When: 11:30 a.m. Tuesday

How to learn more: Wolf's budget address will be livestreamed from the capitol and can be viewed at PennLive.com. PennLive reporters will also be pouring over the budget early in the day to bring you a summary by late Tuesday morning of the highlights of the budget and the effect it would have on everything from libraries to prisons.

The situation today: The state, according to Wolf, is facing a $2.3 billion deficit. He also has said he wants to increase spending for education, and wants to increase the state's share of school districts' costs. Republicans say a top priority is pension reform, to address large, looming increases in government contributions to state pension plans.

What to expect: There likely will be some more surprises, and some details that have yet to be explained, but here's what sources say are some key changes Wolf will be proposing.

Taxes

Wolf is expected to propose a tax shift that would increase the state-funded discount on school property taxes for homeowners and farms, but raise the personal income tax 20 percent, from 3.07 percent to 3.7 percent, and raise the state sales tax 10 percent, from 6 to 6.6 percent.

The tax increases would be used, at least in part, to offset property taxes in keeping with Wolf's pledge to shift more of the school funding burden to the state. Right now, the state has about $600 million a year from gambling revenue that's used to reduce property taxes. Wolf's aim, according to sources, is to increase that pool to more than $3 billion.

Wolf might also proposing taxing tobacco products, such as cigars, that aren't now taxed, and may also suggest an increase in the cigarette tax.

Does that mean that my taxes will increase or decrease?

We don't know - it's all about the details. Will Wolf try to increase the income you can earn that's exempt from taxation? Will the sales tax apply to more goods and services than it does now? Do you rent or own? Will there be special provisions to protect low-income households and renters from the higher income and sales taxes?

It's largely going to depend on your individual situation, but we're guessing that Wolf will try to maximize the number of people who receive a break in the hopes of selling a plan that has the word tax increase in it multiple times.

Business taxes

Wolf has already called for a 5 percent extraction tax on gas production. He's also said he will propose to cut the state's corporate income tax rate - from 9.99 percent to 5.99 percent in 2016, and get rid of loopholes that allowed some corporate profits to escape taxation.

And finally, the governor will allow the scheduled elimination of the capital stock and franchise tax - a tax on in-state business assets - to be completed in 2016, as previously scheduled.

Pensions

Will Wolf's budget address the pension crisis that his predecessor, Gov. Tom Corbett, considered the most serious issue facing the state? Indications are Wolf doesn't consider it as much an immediate problem as Corbett did.

Education

Sources said Friday that Wolf's plan contains about $1 billion in new spending across the public education spectrum, from early childhood programs to local schools to public colleges and universities.

Senior citizens

Wolf last week said he plans to expand home- and community-based long-term care for an additional 5,500 people in 2015-16. Avoiding nursing home care for that many people will save taxpayers $162 million a year, according to the administration's projections.

Health care

Wolf has announced plans to shift away from the Healthy PA plan devised by his predecessor to an expansion of Medicaid. How will this affect the bottom line? It may take a while to figure that out.

Republicans

Wolf's proposed budget is just a starting point. Now he has to see what's possible to get approved by the Republican-controlled General Assembly. Republicans, in general, don't favor broad-based tax increases. Will they find enough that they do like in Wolf's budget to make some tax increase palatable? Stay tuned.