PRINTER'S NO. 3466
No. 2547 Session of 1998
INTRODUCED BY BARD, SAYLOR, ARMSTRONG, TIGUE, HERSHEY, MELIO,
ORIE, ROONEY AND BENNINGHOFF, APRIL 27, 1998
REFERRED TO COMMITTEE ON FINANCE, APRIL 27, 1998
AN ACT
1 Authorizing counties to impose sales and use, optional local
2 cigarette taxes, occupancy, personal income or earned income
3 and net profits taxes; authorizing municipalities to impose
4 personal income, earned income and net profits taxes;
5 authorizing school districts to impose personal income,
6 earned income and net profits taxes; providing for the
7 levying, assessment and collection of such taxes; providing
8 an additional homestead exemption for certain qualified
9 persons; and providing for the powers and duties of the
10 Department of Community and Economic Development, the
11 Department of Revenue and the State Treasurer.
12 TABLE OF CONTENTS
13 Chapter 1. General Provisions
14 Section 101. Short title.
15 Section 102. Definitions.
16 Section 103. Scope and limitations.
17 Section 104. Preemption.
18 Section 105. Certain rates of taxation limited.
19 Section 106. Extraordinary service charge.
20 Chapter 3. Subjects of Taxation
21 Subchapter A. Tax Authorization
22 Section 301. General tax authorization.
1 Section 302. Continuity of tax.
2 Section 303. Election to participate under act.
3 Section 304. Public referendum for increasing
4 property taxes previously reduced.
5 Subchapter B. County Sales and Use Tax
6 Section 311. Construction.
7 Section 312. Imposition.
8 Section 313. Situs.
9 Section 314. Licenses.
10 Section 315. Rules and regulations; collection costs.
11 Section 316. Procedure and administration.
12 Section 317. County sales and use tax funds.
13 Section 318. Disbursements.
14 Subchapter C. Personal Income Tax
15 Section 321. Construction.
16 Section 322. Personal income tax.
17 Section 323. Collections.
18 Section 324. Rules and regulations; collection costs.
19 Section 325. Procedure.
20 Section 326. Local personal income tax funds.
21 Section 327. Disbursements.
22 Subchapter D. Earned Income and Net Profits Tax
23 Section 331. Earned income and net profits tax.
24 Section 332. Collections.
25 Section 333. Rules and regulations.
26 Section 334. Procedure and administration.
27 Subchapter E. Optional County Cigarette Tax
28 Section 341. Construction of subchapter.
29 Section 342. Subchapter definitions.
30 Section 343. Imposition of tax.
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1 Section 344. Licenses.
2 Section 345. Rules and regulations; collection costs.
3 Section 346. Procedure and administration.
4 Section 347. County cigarette tax funds.
5 Section 348. Disbursements.
6 Subchapters F through I (Reserved)
7 Chapter 5. Credits, Exemptions and Deferrals
8 Subchapter A. Credits
9 Section 501. Credits.
10 Subchapter B. Tax Relief for Eligible Claimants.
11 Section 511. Subchapter definitions.
12 Section 512. Special property tax relief for eligible
13 claimants.
14 Section 513. Application procedure.
15 Subchapters C through J (Reserved)
16 Chapter 7. Disposition of Tax Revenues
17 Section 701. Use of sales tax revenues.
18 Section 702. Use of income tax revenues.
19 Section 703. Methods of reducing real property tax.
20 Section 704. Use of county cigarette tax revenue.
21 Chapter 9. Register for Certain Taxes
22 Section 901. Definitions.
23 Section 902. Register for taxes under this act.
24 Section 903. Information for register.
25 Section 904. Availability and effective period of register.
26 Section 905. Effect of nonfiling.
27 Section 906. Effect of chapter on liability of taxpayer.
28 Chapter 51. Miscellaneous Provisions
29 Section 5101. Effective date.
30 The General Assembly of the Commonwealth of Pennsylvania
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1 hereby enacts as follows:
2 CHAPTER 1
3 GENERAL PROVISIONS
4 Section 101. Short title.
5 This act shall be known and may be cited as the Optional
6 Local Tax Enabling Act.
7 Section 102. Definitions.
8 The following words and phrases when used in this act shall
9 have the meanings given to them in this section unless the
10 context clearly indicates otherwise:
11 "Association." As defined in section 301 of the act of March
12 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.
13 "Board of county commissioners." Includes the successor in
14 function to the board of county commissioners in a county which
15 has adopted a home rule charter under the former act of April
16 13, 1972 (P.L.184, No.62), known as the Home Rule Charter and
17 Optional Plans Law, or under 53 Pa. C.S. Pt. III Subpt.E
18 (relating to home rule and optional plan government) but does
19 not include the city council of a city of the first class.
20 "Budgeted revenue." The revenue from taxes actually levied
21 and assessed by a local government unit. The term does not
22 include revenue from:
23 (1) Delinquent taxes.
24 (2) Payments in lieu of taxes.
25 (3) The real estate transfer tax.
26 (4) The tax imposed on public utility realty, commonly
27 known as PURTA.
28 (5) Interest or dividend earnings.
29 (6) Federal or State grants, contracts or
30 appropriations.
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1 (7) Income generated from operations.
2 (8) Any other source of revenue that is not derived
3 directly from taxes levied and assessed by a local government
4 unit.
5 "Classes of income." The classes of income set forth in
6 section 303 of the act of March 4, 1971 (P.L.6, No.2), known as
7 the Tax Reform Code of 1971.
8 "Compensation." As defined in section 301 of the act of
9 March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
10 1971.
11 "County." A county-level municipality within this
12 Commonwealth, regardless of classification. The term includes a
13 county which has adopted a home rule charter or optional plan of
14 government under the former act of April 13, 1972 (P.L.184,
15 No.62), known as the Home Rule Charter and Optional Plans Law or
16 under 53 Pa.C.S. Pt. III Subpt. E (relating to home rule and
17 optional plan government). The term does not include a county of
18 the first class.
19 "Current year." The calendar or fiscal year for which the
20 tax is levied.
21 "Department." The Department of Revenue of the Commonwealth.
22 "Domicile." As defined in section 13 of the act of December
23 31, 1965 (P.L.1257, No.511), known as The Local Tax Enabling
24 Act.
25 "Earned income." The classes of income defined as earned
26 income in section 13 of the act of December 31, 1965 (P.L.1257,
27 No.511), known as The Local Tax Enabling Act.
28 "Employer." As defined in section 301 of the act of March 4,
29 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.
30 "Governing body." The board of county commissioners,
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1 including the successor in function to the board of county
2 commissioners in a county which has adopted a home rule charter
3 under the former act of April 13, 1972 (P.L.184, No.62), known
4 as the Home Rule Charter and Optional Plans Law or under 53
5 Pa.C.S. Pt III Subpt. E (relating to home rule and optional plan
6 government), city council, borough council, incorporated town
7 council, board of township commissioners, board of township
8 supervisors, a governing council of a home rule municipality or
9 optional plan municipality, a governing council of any similar
10 general purpose unit of government which may hereafter be
11 created by statute, or a board of school directors of a school
12 district. The term does not include the city council of a city
13 of the first class.
14 "Income tax." Includes the earned income and net profits tax
15 and the personal income tax levied under this act.
16 "Individual." As defined in section 301 of the act of March
17 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.
18 "Individual eligible for special tax treatment." An
19 individual qualifying for the special tax provisions for poverty
20 under section 304 of the act of March 4, 1971 (P.L.6, No.2),
21 known as the Tax Reform Code of 1971.
22 "Local Tax Enabling Act." The act of December 31, 1965
23 (P.L.1257, No.511), known as The Local Tax Enabling Act.
24 "Municipality." A city of the second class, city of the
25 second class A, city of the third class, borough, incorporated
26 town, township of the first class, township of the second class,
27 home rule municipality, optional plan municipality, optional
28 form municipality or similar general purpose unit of government
29 which may hereafter be created by statute. The term does not
30 include a city of the first class.
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1 "Net profits." The classes of income defined as net profits
2 in section 13 of the act of December 31, 1965 (P.L.1257,
3 No.511), known as The Local Tax Enabling Act.
4 "Optional form municipality." A city which has adopted an
5 optional form of government under the act of July 15, 1957
6 (P.L.901, No.399), known as the Optional Third Class City
7 Charter Law.
8 "Optional plan municipality." A city, borough, incorporated
9 town or township which has adopted an optional plan of
10 government under the former act of April 13, 1972 (P.L.184,
11 No.62), known as the Home Rule Charter and Optional Plans Law or
12 under 53 Pa.C.S. Pt III Subpt. E (relating to home rule and
13 optional plan government).
14 "Ordinance." Includes a resolution.
15 "Personal income." The classes of income enumerated in
16 section 303 of the act of March 4, 1971 (P.L.6, No.2), known as
17 the Tax Reform Code of 1971 and upon which is imposed a personal
18 income tax by the Commonwealth.
19 "Preceding year." The calendar year or fiscal year before
20 the current year.
21 "Register." The register provided for in Chapter 9.
22 "Resident individual." An individual who is domiciled in a
23 county, municipality or school district.
24 "School district." A school district of the first class A,
25 second class, third class or fourth class, including any
26 independent school district.
27 "Tax officer." The person, public employee or private agency
28 designated by a governing body to collect and administer the
29 municipal service tax imposed under this act.
30 "Tax Reform Code." The act of March 4, 1971 (P.L.6, No.2),
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1 known as the Tax Reform Code of 1971.
2 "Taxpayer." An individual required under this act to file a
3 tax return or to pay a tax.
4 Section 103. Scope and limitations.
5 It is the intent of this act to confer upon each county,
6 municipality and school district the power to levy, assess and
7 collect taxes upon the subjects of taxation set forth in this
8 act.
9 Section 104. Preemption.
10 No act of the General Assembly will vacate or preempt any
11 ordinance adopted under this act providing for the imposition of
12 a tax by a county, municipality or school district unless the
13 act of the General Assembly expressly vacates or preempts the
14 authority to adopt the ordinance.
15 Section 105. Certain rates of taxation limited.
16 (a) Earned income limitation.--If a municipality and school
17 district both impose an earned income tax on the same individual
18 under the Local Tax Enabling Act and the municipality and school
19 district are limited to, or have agreed upon, a division of the
20 tax rate in accordance with section 8 of the Local Tax Enabling
21 Act, then the tax rate in the municipality or school district
22 which continues to levy the earned income tax under the Local
23 Tax Enabling Act shall remain subject to that limitation or
24 agreement or a tax rate of 0.5%, whichever is greater, in the
25 event that one or the other opts to impose a tax under section
26 322 or 331.
27 (b) Other tax limitations.--Notwithstanding any other
28 provision of this act, any municipality or school district may
29 levy, assess and collect an amusement tax on admissions to
30 places of amusement, athletic events and the like, motion
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1 picture theaters, ski facilities, golf courses and bowling
2 alleys at a rate not to exceed 4%.
3 Section 106. Extraordinary service charge.
4 (a) General rule.--
5 (1) An extraordinary service charge may be imposed on an
6 amusement facility in accordance with section 105(b) no more
7 than once in any fiscal year.
8 (2) Written notice of the imposition and amount of the
9 extraordinary service charge shall be given to the amusement
10 facility owner by United States mail. The notice shall state
11 the time, date and place of a meeting to be held not more
12 than 30 days from the date of the notice at which meeting
13 representatives of the owner and the political subdivision
14 shall review the criteria for establishing the extraordinary
15 service charge and shall attempt to come to an agreement
16 concerning the amount of the charge.
17 (3) If the amusement facility owner and the political
18 subdivision cannot agree on the amount of the extraordinary
19 service charge, the owner shall have 30 days from the date of
20 the meeting held in accordance with paragraph (2) to petition
21 to the court requesting that the court, after hearing, make
22 an order or decree determining the amount of the
23 extraordinary service charge, if any, which may be imposed.
24 (4) A copy of said petition, duly certified, shall be
25 served upon the political subdivision with notice of the
26 date, as determined by the court, on or before which the
27 political subdivision must file its answer to the petition
28 setting forth the criteria upon which the extraordinary
29 service charge is based and other matters which the political
30 subdivision may deem relevant. The court shall thereupon fix
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1 a time to hear the evidence of the parties, or it may refer
2 the matter to a master who shall hear the testimony of the
3 parties and report the findings, in the same manner and under
4 the same procedure as provided by the rules in equity in
5 similar cases, to the court, which may reject, confirm or
6 modify the same, and may make its decree or order directing
7 the imposition of the extraordinary service charge as may be
8 deemed reasonably necessary or desirable, and providing for
9 the sharing of court costs and other expenses related to the
10 adjudication of this matter between the political subdivision
11 and the amusement facility owner, in equal portions.
12 (b) Definitions.--As used in this section, the following
13 words and terms shall have the meaning given in this subsection
14 unless the context clearly indicates otherwise:
15 "Amusement facility." A place of amusement, facility for
16 athletic events and the like, ski facility, golf course, bowling
17 alleys or bowling lanes, for which there has been levied, or
18 provided for, an amusement tax on the admission.
19 "Extraordinary services." Subject to the conditions set
20 forth in paragraphs (1), (2), (3) and (4), the term means the
21 services provided by a political subdivision to a place of
22 amusement and shall include not only the provision of fire,
23 police, emergency, and other municipal services.
24 (1) The extraordinary services are necessitated by and
25 attributable to the existence or operation of the amusement
26 facility.
27 (2) The costs of the extraordinary services would not
28 have been incurred by the political subdivision but for the
29 existence or operation of the amusement facility.
30 (3) The political subdivision is not reasonably
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1 reimbursed for the cost of the extraordinary services through
2 taxes or other charges.
3 (4) Salaries, wages and benefits of employees, the costs
4 of materials and supplies, transportation and communication
5 costs, and other direct and incidental fiscal expenses
6 incurred in providing extraordinary services are among the
7 items which may be considered in computing the cost of the
8 extraordinary services for which reimbursement is sought.
9 CHAPTER 3
10 SUBJECTS OF TAXATION
11 SUBCHAPTER A
12 TAX AUTHORIZATION
13 Section 301. General tax authorization.
14 (a) General rule.--Subject to section 303 and except as
15 provided in subsection (b), each county, municipality or school
16 district shall have the power and may by ordinance levy, assess
17 and collect or provide for the levying, assessment and
18 collection of such taxes on the subjects specified in this
19 chapter for general revenue purposes as it shall determine on
20 any or all of the subjects of taxation set forth in this act
21 within the geographical limits of the county, municipality or
22 school district.
23 (b) Exclusions.--No county, municipality or school district
24 which levies a tax authorized by this act shall have any power
25 or authority to levy, assess or collect:
26 (1) The intangible personal property tax under the act
27 of June 17, 1913 (P.L.507, No.335), referred to as the
28 Intangible Personal Property Tax Law.
29 (2) The earned income and net profits tax levied under
30 the Local tax Enabling Act.
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1 (3) An earned income tax under the act of August 24,
2 1961 (P.L.1135, No.508), referred to as the First Class A
3 School District Earned Income Tax Act, or under the act of
4 March 10, 1949 (P.L.30, No.14), known as the Public School
5 Code of 1949.
6 (4) A tax based upon a flat rate or on a millage rate on
7 an assessed valuation of a particular trade, occupation or
8 profession, commonly known as an occupation tax.
9 (c) Rate limitations.--No county, municipality or school
10 district which levies a tax authorized by this act shall have
11 any power or authority to increase the rate of:
12 (1) A tax at a set or flat rate upon persons employed
13 within the taxing district, commonly known as an occupational
14 privilege tax above $40.
15 (2) A per capita, poll, residence or similar head tax
16 above $40.
17 (3) An amusement or admissions tax as limited by section
18 105(b).
19 (d) Delinquent taxes.--Subsection (b) shall not apply to the
20 collection of delinquent taxes lawfully levied or assessed prior
21 to the levying or assessment of taxes permitted under this act.
22 Section 302. Continuity of tax.
23 Every tax levied under the provisions of this act shall
24 continue in force on a calendar or fiscal year basis, as the
25 case may be, without annual reenactment unless the rate of tax
26 is increased, decreased or the tax is subsequently repealed.
27 Section 303. Election to participate under act.
28 (a) General rule.--
29 (1) Any governing body which desires to participate
30 under the provisions of this act shall make that
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1 determination by using the procedures set forth in subsection
2 (b).
3 (2) Any governing body after making an election to
4 participate under this act may, after a period of at least
5 three full calendar years or fiscal years of participation,
6 elect, under the provisions of subsection (b), to levy,
7 assess and collect the taxes prohibited by section 301(b) to
8 the extent otherwise provided by law.
9 (b) Public referendum requirements to participate or end
10 participation under act.--Subject to the notice and public
11 hearing requirements of section 316(a), 325(a) or 334, whichever
12 is applicable, a governing body may elect to participate or, in
13 accordance with subsection (a)(2), may elect to end
14 participation under this act only by first obtaining the
15 approval of the electorate of the affected county, municipality
16 or school district in a public referendum at the primary or
17 general election preceding the calendar year or fiscal year when
18 the taxes will be initially imposed. The referendum question
19 must state the initial rate of the proposed tax, the reason for
20 the tax, and whether there will be a referendum on future tax
21 increases under section 304. The governing body must frame the
22 question in clear language that is readily understandable by the
23 layperson. A nonlegal interpretative statement must accompany
24 the question in accordance with section 201.1 of the act of June
25 3, 1937 (P.L.1333, No.320), known as the Pennsylvania Election
26 Code, that includes the following:
27 (1) the initial rate of the tax or taxes to be imposed;
28 (2) the estimated revenues to be derived from the
29 initial rate of the tax or taxes imposed under this act;
30 (3) the identification of the existing taxes to be
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1 eliminated;
2 (4) the method or methods to be used to reduce real
3 property taxes;
4 (5) the class or classes of real property for which real
5 property taxes would be reduced;
6 (6) the estimated amount of real property tax reduction
7 by class, expressed as an average percent reduction by class;
8 and
9 (7) whether a public referendum for increasing property
10 taxes previously reduced will be held as authorized under
11 section 304.
12 (c) Effect of negative referendum.--If there is a failed
13 attempt to participate under the provisions of this act, this
14 section shall not require the approval of the electorate as a
15 prerequisite to the increase in the rate of any tax which the
16 governing body of the affected county, municipality or school
17 district is authorized to levy and increase pursuant to any
18 other act.
19 Section 304. Public referendum for increasing property taxes
20 previously reduced.
21 (a) General rule.--Except as provided in subsection (c), a
22 governing body of a municipality, county or school district
23 which elects to participate under this act pursuant to section
24 303(a) may, prior to increasing the rate of real property taxes
25 that were reduced using revenue derived from an income or sales
26 tax, or both, imposed under this act or any other act by an
27 amount exceeding the annual percent change in the Statewide
28 average weekly wage in the preceding year, obtain approval of
29 the tax rate increase by the electorate of the affected county,
30 municipality or school district in a public referendum at the
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1 November election immediately preceding the calendar year of the
2 proposed tax increase for entities operating on a calendar year
3 fiscal basis and at the primary election for the calendar year
4 of the proposed tax increase for entities operating on a July to
5 June fiscal basis.
6 (b) Disapproval.--Whenever the electorate fails to approve a
7 proposed referendum question authorized under subsection (a)
8 increasing the rates of tax, the governing body shall be limited
9 to the tax rate in effect prior to the referendum.
10 (c) Referendum exceptions.--The provisions of subsection (a)
11 shall not apply to any necessary tax increases in the following
12 cases:
13 (1) To respond to or recover from an emergency or
14 disaster declared pursuant to 35 Pa.C.S. Pt. V (relating to
15 emergency management services), for the duration of the
16 emergency or disaster or for the costs of the recovery from
17 the emergency or disaster.
18 (2) To implement a court order or an administrative
19 decision of a Federal or State agency. In instances where the
20 tax increase is necessary to respond to a court order or an
21 administrative decision of a Federal or State agency
22 requiring a temporary increase in local expenditures, the
23 rate increase shall be rescinded following fulfillment of the
24 court order or administrative decision.
25 (3) To pay interest and principal on any indebtedness
26 incurred under 53 Pa.C.S. Pt. VII Subpt. B (relating to
27 indebtedness and borrowing). However, in no case may a taxing
28 jurisdiction incur additional debt under this paragraph,
29 except for the refinancing of existing debt, including the
30 payment of costs and expenses related to such refinancing and
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1 the establishment or funding of appropriate debt service
2 reserves.
3 (4) Taxes levied under section 607(f) of the act of
4 December 18, 1984 (P.L.1005, No.205), known as the Municipal
5 Pension Plan Funding Standard and Recovery Act, or levied to
6 pay increases in pension fund requirements which are in
7 excess of the annual average increase over the immediately
8 preceding five fiscal years.
9 (5) To increase revenues when actual and projected local
10 tax revenues, including any share of a county sales and use
11 tax, decline from the immediately preceding year but only to
12 the extent of the revenue decline.
13 (6) To respond to conditions that pose a threat of
14 immediate harm or injury to the students, staff or residents
15 of the county, municipality or school district.
16 (7) Special purpose tax levies approved by the
17 electorate.
18 (8) To respond to a Federal or State statute, regulation
19 or order adding to or significantly altering responsibilities
20 and duties or requiring expenditure of county or local funds
21 to the extent not funded by the Federal or State Government.
22 This provision shall apply only to a Federal or State
23 statute, regulation or order taking effect after the
24 effective date of this act.
25 (d) Court action.--Prior to any tax increase under
26 subsection (c)(1), (4), (5), (6) or (8), approval is required by
27 the court of common pleas in the judicial district in which the
28 governing body is located. The following shall apply to any
29 proceedings instituted under this subsection:
30 (1) The governing body must prove by a preponderance of
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1 evidence the necessity for the tax increase.
2 (2) The court may retain continuing jurisdiction in
3 these cases and may, on its own motion or on petition of an
4 interested party, revoke approval for a tax increase.
5 (e) Distressed municipality or county.--This section shall
6 not be construed to prohibit any municipality or county declared
7 distressed under the act of July 10, 1987 (P.L.246, No.47),
8 known as the Municipalities Financial Recovery Act, from
9 petitioning the court of common pleas for a tax increase in
10 accordance with section 123(c) of the Municipalities Financial
11 Recovery Act.
12 (f) Standing.--Any taxpayer or business shall have standing
13 as a party to a proceeding under this section as long as the
14 taxpayer or business resides within or pays real property taxes
15 to the taxing jurisdiction of the governing body instituting the
16 action.
17 SUBCHAPTER B
18 COUNTY SALES AND USE TAX
19 Section 311. Construction.
20 The tax imposed by the governing body of a county under this
21 subchapter shall be in addition to any tax imposed by the
22 Commonwealth under Article II of the Tax Reform Code. Except for
23 the differing situs provisions under section 313, the provisions
24 of Article II of the Tax Reform Code shall apply to the tax.
25 Section 312. Imposition.
26 (a) Sales.--The governing body of a county, except for a
27 county of the second class, may levy and assess upon each
28 separate sale at retail of tangible personal property or
29 services, as defined in Article II of the Tax Reform Code,
30 within the boundaries of the county, a tax on the purchase
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1 price. The tax shall be collected by the vendor from the
2 purchaser and shall be paid over to the Commonwealth as provided
3 in this subchapter. The sales tax shall not be paid to the
4 Commonwealth by any person who has paid the tax imposed under
5 Chapter 5 of the act of June 5, 1991 (P.L.9, No.6), known as the
6 Pennsylvania Intergovernmental Cooperation Authority Act for
7 Cities of the First Class, or subdivision (e) of Article XXXI-B
8 of the act of July 28, 1953 (P.L.723, No.230), known as the
9 Second Class County Code, equal to or greater than the tax
10 imposed under this subsection.
11 (b) Use.--In any county, except for a county of the second
12 class, within which the tax authorized in subsection (a) is
13 imposed, there shall be levied, assessed and collected upon the
14 use, within the county, of tangible personal property purchased
15 at retail and on services purchased at retail, as defined in
16 Article II of the Tax Reform Code, a tax on the purchase price.
17 The tax shall be paid over to the Commonwealth by the person who
18 makes the use. The use tax imposed under this subchapter shall
19 not be paid over to the Commonwealth by any person who has paid
20 the tax imposed under:
21 (1) Subsection (a).
22 (2) This subsection to the vendor with respect to the
23 use.
24 (3) Chapter 5 of the Pennsylvania Intergovernmental
25 Cooperation Authority Act for Cities of the First Class,
26 equal to or greater than the tax imposed under either
27 subsection (a) or this subsection.
28 (4) Subdivision (e) of Article XXXI-B of the Second
29 Class County Code equal to or greater than the tax imposed
30 under either subsection (a) or this subsection.
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1 (c) Occupancy.--In any county within which a tax authorized
2 by subsection (a) is imposed, there shall be levied, assessed
3 and collected an excise tax on the rent upon every occupancy of
4 a room or rooms in a hotel in the county. The tax shall be
5 collected by the operator or owner from the occupant and paid
6 over to the Commonwealth.
7 (d) Rate and uniformity.--
8 (1) The tax imposed by subsections (a), (b) and (c)
9 shall be imposed at a rate of 1%.
10 (2) The tax imposed by subsections (a), (b) and (c)
11 shall be uniform.
12 (e) Computation.--The tax imposed under this section shall
13 be computed in the manner set forth in section 503(e)(2) of the
14 Pennsylvania Intergovernmental Cooperation Authority Act for
15 Cities of the First Class.
16 Section 313. Situs.
17 (a) General rule.--Except as provided in subsections (b) and
18 (c), the situs of sales at retail or uses, including leases, of
19 motor vehicles, aircraft, motorcraft and utility services shall
20 be determined in the manner specified by section 504 of the act
21 of June 5, 1991 (P.L.9, No.6), known as the Pennsylvania
22 Intergovernmental Cooperation Authority Act for Cities of the
23 First Class, as well as the Tax Reform Code.
24 (b) Premium cable services.--The sale or use of premium
25 cable service shall be deemed to occur at the service address in
26 the county where the customer cable connection is located. This
27 subsection shall determine the situs of premium cable service
28 for the purpose of all local sales taxes, including those
29 imposed pursuant to Chapter 5 of the Pennsylvania
30 Intergovernmental Cooperation Authority Act for Cities of the
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1 First Class and pursuant to subdivision (e) of Article XXXI-B of
2 the act of July 28, 1953 (P.L.723, No.230), known as the Second
3 Class County Code.
4 (c) Telecommunications service.--The situs of
5 telecommunications service under this act shall be determined in
6 accordance with regulations adopted by the department, which
7 shall be uniform among all counties, and shall be consistent
8 with regulations promulgated under subdivision (e) of Article
9 XXXI-B of the act of July 28, 1953 (P.L.723, No.230), known as
10 the Second Class County Code, Article II of the Tax Reform Code
11 and Chapter 5 of the Pennsylvania Intergovernmental Cooperation
12 Authority Act for Cities of the First Class.
13 Section 314. Licenses.
14 A license for the collection of the tax imposed by this
15 subchapter shall be issued in the same manner as is provided for
16 in section 505 of the act of June 5, 1991 (P.L.9, No.6), known
17 as the Pennsylvania Intergovernmental Cooperation Authority Act
18 for Cities of the First Class. Licensees shall be entitled to
19 the same discount as provided in section 227 of the Tax Reform
20 Code.
21 Section 315. Rules and regulations; collection costs.
22 (a) Regulations.--Rules and regulations shall be applicable
23 to the taxes imposed under section 312 in the same manner as is
24 provided for in section 506(1) and (2) of the act of June 5,
25 1991 (P.L.9, No.6), known as the Pennsylvania Intergovernmental
26 Cooperation Authority Act for Cities of the First Class.
27 (b) Administrative costs.--The department, to cover its
28 costs of administration, shall be entitled to retain a sum equal
29 to the costs of administration but in no case shall the sum
30 exceed 1% of the revenues collected under this subchapter. When
19980H2547B3466 - 20 -
1 the annual operating budget for the department is submitted to
2 the General Assembly, the department shall also submit to the
3 chairman and minority chairman of the Appropriations Committee
4 of the Senate and to the chairman and minority chairman of the
5 Appropriations Committee of the House of Representatives a
6 report of the actual sums retained for costs of collection in
7 the preceding fiscal year, together with all supporting details.
8 Section 316. Procedure and administration.
9 (a) Ordinance.--Any county desiring to impose the tax
10 authorized by section 312 shall adopt an ordinance. The
11 ordinance shall state the tax rate and refer to this subchapter.
12 The ordinance shall authorize the imposition of all taxes
13 provided for in section 312. Prior to adopting an ordinance
14 imposing the tax authorized by section 312, the governing body
15 of the county shall give public notice of its intent to adopt
16 the ordinance in the manner provided by section 4 of the Local
17 Tax Enabling Act and shall conduct at least one public hearing
18 regarding the proposed adoption of the ordinance.
19 (b) Notification to department.--A certified copy of the
20 county ordinance shall be delivered to the department by
21 September 1 of the year prior to the effective date thereof. The
22 county ordinance shall become effective on the January 1
23 following at least four months after the date of enactment of
24 the county ordinance.
25 (c) Delivery of repeal ordinance.--A certified copy of a
26 repeal ordinance shall be delivered to the department at least
27 30 days prior to the effective date of the repeal.
28 Section 317. County sales and use tax funds.
29 There is hereby created for each county levying the tax under
30 section 312 the (proper name) County Sales and Use Tax Fund. The
19980H2547B3466 - 21 -
1 State Treasurer shall be custodian of the funds which shall be
2 subject to the provisions of law applicable to funds listed in
3 section 302 of the act of April 9, 1929 (P.L.343, No.176), known
4 as The Fiscal Code. Taxes imposed under section 312 shall be
5 received by the department and paid to the State Treasurer and,
6 along with interest and penalties, less any collection costs
7 allowed under this subchapter and any refunds and credits paid,
8 shall be credited to the funds not less frequently than every
9 two weeks. All moneys in the funds, including, but not limited
10 to, moneys credited to the funds under this section, prior year
11 encumbrances and the interest earned thereon, shall not lapse or
12 be transferred to any other fund, but shall remain in the funds.
13 Pending their disbursement, moneys received on behalf of or
14 deposited into the funds shall be invested or reinvested as are
15 other moneys in the custody of the State Treasurer in the manner
16 provided by law. All earnings received from the investment or
17 reinvestment of the moneys under this section shall be credited
18 to the respective funds. The Auditor General shall periodically
19 audit the records of the department relative to its duties under
20 this section and shall furnish the results of such audit to any
21 county levying the sales and use tax under section 312.
22 Section 318. Disbursements.
23 On or before the tenth day of every month, the State
24 Treasurer shall make the disbursements on behalf of the county
25 imposing the tax out of the moneys which are, as of the last day
26 of the previous month, contained in the respective county sales
27 and use tax fund.
28 SUBCHAPTER C
29 PERSONAL INCOME TAX
30 Section 321. Construction.
19980H2547B3466 - 22 -
1 The tax imposed by the governing body of a county,
2 municipality or school district under this subchapter shall be
3 in addition to any tax imposed by the Commonwealth under Article
4 III of the Tax Reform Code. The provisions of Article III of the
5 Tax Reform Code shall apply to the tax.
6 Section 322. Personal income tax.
7 (a) Municipalities.--A municipality shall have the power to
8 levy, assess and collect a tax on the personal income of
9 resident individuals of the municipality up to a maximum rate of
10 1%.
11 (b) School districts.--Each school district shall have the
12 power to levy, assess and collect a tax on personal income of
13 resident individuals of the school district up to a maximum rate
14 of 2%.
15 (c) Counties.--Each county shall have the power and may
16 levy, assess and collect a tax on the personal income of
17 resident individuals of the county up to a maximum rate of 1%.
18 Section 323. Collections.
19 (a) General rule.--Any county, municipality or school
20 district imposing a tax under section 322(a), (b) or (c) may:
21 (1) enter into an agreement with the department to
22 collect the taxes as provided in this subchapter; or
23 (2) designate the tax officer who is appointed under
24 section 10 of the Local Tax Enabling Act, or otherwise by
25 law, as the collector of the county, municipality or school
26 district personal income tax.
27 (b) Powers and duties of tax collector.--In the performance
28 of the tax collection duties under this subchapter, the
29 designated tax officer shall have all the same powers, rights,
30 responsibilities and duties for the collection of the taxes
19980H2547B3466 - 23 -
1 which may be imposed under the Local Tax Enabling Act or
2 otherwise by law.
3 Section 324. Rules and regulations; collection costs.
4 (a) Regulations.--Taxes imposed under section 322 are
5 subject to the rules and regulations adopted by the department
6 pursuant to Article III of the Tax Reform Code.
7 (b) Administrative costs.--The department, to cover its
8 costs of administration, shall be entitled to retain a sum equal
9 to the costs of administration but in no case shall the sum
10 retained exceed the amount specified in the agreement under
11 which the department collects the tax. When the annual operating
12 budget for the department is submitted to the General Assembly,
13 the department shall also submit to the chairman and minority
14 chairman of the Appropriations Committee of the Senate and to
15 the chairman and minority chairman of the Appropriations
16 Committee of the House of Representatives a report of the actual
17 sums retained for costs of collection in the preceding fiscal
18 year, together with all supporting details.
19 Section 325. Procedure.
20 The governing body of the municipality, school district or
21 county, in order to impose the tax authorized by section 322,
22 shall adopt an ordinance which shall refer to this subchapter.
23 Prior to adopting an ordinance imposing the tax authorized by
24 section 322, the respective governing body shall give public
25 notice of its intent to adopt the ordinance in the manner
26 provided by section 4 of the Local Tax Enabling Act and shall
27 conduct at least one public hearing regarding the proposed
28 adoption of the ordinance.
29 Section 326. Local personal income tax funds.
30 There is hereby created for each municipality, school
19980H2547B3466 - 24 -
1 district and county levying the tax under section 322 and
2 entering into an agreement with the department for its
3 collection, the (proper name) Personal Income Tax Fund. The
4 State Treasurer shall be custodian of the funds which shall be
5 subject to the provisions of law applicable to funds listed in
6 section 302 of the act of April 9, 1929 (P.L.343, No.176), known
7 as The Fiscal Code. Taxes imposed under section 322 shall be
8 received by the department and paid to the State Treasurer and,
9 along with interest and penalties, less any collection costs
10 allowed under this subchapter and any refunds and credits paid,
11 shall be credited to the funds not less frequently than 60 days
12 after the end of each calendar quarter. All moneys in the funds,
13 including, but not limited to, moneys credited to the funds
14 under this section, prior year encumbrances and the interest
15 earned thereon, shall not lapse or be transferred to any other
16 fund, but shall remain in the funds. Pending their disbursement,
17 moneys received on behalf of or deposited into the funds shall
18 be invested or reinvested as are other moneys in the custody of
19 the State Treasurer in the manner provided by law. All earnings
20 received from the investment or reinvestment of the moneys shall
21 be credited to the respective funds. The Auditor General shall
22 periodically audit the records of the department relative to its
23 duties under this section and shall furnish the results of such
24 audit to any county, municipality or school district utilizing
25 the department for the collection of the personal income tax
26 pursuant to section 323.
27 Section 327. Disbursements.
28 On or before the tenth day of each month, the State Treasurer
29 shall make the disbursements to each municipality, school
30 district and county imposing the tax out of the moneys which
19980H2547B3466 - 25 -
1 are, as of the last day of the previous month, contained in the
2 respective personal income tax funds. If disbursements are not
3 made on or before the tenth day of each month, a 5% penalty
4 shall be added thereto plus a 1% late charge per month delayed.
5 This section shall only apply to a municipality, school district
6 or county which enters into an agreement with the department to
7 collect the taxes as provided in section 323(1).
8 SUBCHAPTER D
9 EARNED INCOME AND NET PROFITS TAX
10 Section 331. Earned income and net profits tax.
11 (a) Municipalities.--In lieu of imposing the tax under
12 section 322, a municipality shall have the power to levy, assess
13 and collect a tax on the earned income and net profits of
14 resident individuals of the municipality up to a maximum rate of
15 1%. Any municipality which imposes a tax under this subsection
16 shall not impose any tax under section 322.
17 (b) School districts.--In lieu of imposing the tax under
18 section 322, a school district shall have the power to levy,
19 assess and collect a tax on the earned income and net profits of
20 resident individuals of the school district up to a maximum rate
21 of 2%. Any school district which imposes a tax under this
22 subsection shall not impose any tax under section 322.
23 (c) Counties.--In lieu of imposing the tax under section
24 322, a county shall have the power to levy, assess and collect a
25 tax on the earned income and net profits of resident individuals
26 of the county up to a maximum rate of 1%. Any county which
27 imposes a tax under this subsection shall not impose any tax
28 under section 322.
29 Section 332. Collections.
30 (a) Designation.--Any municipality, school district or
19980H2547B3466 - 26 -
1 county imposing a tax under section 331 shall designate the tax
2 officer who is appointed under section 10 of the Local Tax
3 Enabling Act, or otherwise by law, as the collector of the
4 earned income and net profits tax.
5 (b) Powers and duties.--In the performance of the tax
6 collection duties under this subchapter, the designated tax
7 officer shall have all the same powers, rights, responsibilities
8 and duties for the collection of the taxes which may be imposed
9 under the Local Tax Enabling Act or otherwise by law.
10 Section 333. Rules and regulations.
11 Taxes imposed under section 331 are subject to the rules and
12 regulations pursuant to section 13 of the Local Tax Enabling
13 Act.
14 Section 334. Procedure and administration.
15 The governing body of the municipality, school district or
16 county, in order to impose the tax authorized by section 331,
17 shall adopt an ordinance which shall refer to this subchapter.
18 Prior to adopting an ordinance imposing the tax authorized by
19 section 331, the respective governing body shall give public
20 notice of its intent to adopt the ordinance in the manner
21 provided by section 4 of the Local Tax Enabling Act, and shall
22 conduct at least one public hearing regarding the proposed
23 adoption of the ordinance.
24 SUBCHAPTER E
25 OPTIONAL COUNTY CIGARETTE TAX
26 Section 341. Construction of subchapter.
27 The tax imposed by the governing body of a county under this
28 subchapter shall be in addition to any tax imposed by the
29 Commonwealth under Article XII of the Tax Reform Code. The
30 provisions of Article XII of the Tax Reform Code shall apply to
19980H2547B3466 - 27 -
1 the tax.
2 Section 342. Subchapter definitions.
3 The following words and phrases when used in this subchapter
4 shall have the meanings given to them in this section unless the
5 context clearly indicates otherwise:
6 "Board of county commissioners." Includes the successor in
7 function to the board of county commissioners in a county which
8 has adopted a home rule charter under the former act of April
9 13, 1972 (P.L.184, No.62), known as the Home Rule Charter and
10 Optional Plans Law, or under 53 Pa.C.S. Pt. III Subpt. E
11 (relating to home rule and optional plan government), including
12 the city council of a city of the first class.
13 "Cigarette." As defined in section 1201 of the act of March
14 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.
15 "Cigarette tax." The tax imposed by the Commonwealth under
16 the provisions of Article XII of the act of March 4, 1971
17 (P.L.6, No.2), known as the Tax Reform Code of 1971.
18 "Cigarette tax stamp." As defined in section 1201 of the act
19 of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
20 1971.
21 "County." A county-level municipality within this
22 Commonwealth, regardless of classification. The term includes a
23 county which has adopted a home rule charter or optional plan of
24 government under the former act of April 13, 1972 (P.L.184,
25 No.62), known as the Home Rule Charter and Optional Plans Law or
26 under 53 Pa.C.S. Pt. III Subpt. E (relating to home rule and
27 optional plan government). The term includes a county of the
28 first class.
29 "Department." The Department of Revenue of the Commonwealth.
30 "Governing body." The board of county commissioners,
19980H2547B3466 - 28 -
1 including the successor in function to the board of county
2 commissioners in a county which has adopted a home rule charter
3 under the former act of April 13, 1972 (P.L.184, No.62), known
4 as the Home Rule Charter and Optional Plans Law or under 53
5 Pa.C.S. Pt III Subpt. E (relating to home rule and optional plan
6 government), including the city council of a city of the first
7 class.
8 Section 343. Imposition of tax.
9 (a) Authorization.--The governing body of a county shall
10 have the power and may, by ordinance, levy and assess a tax upon
11 the sale of cigarettes, as defined in Article XII of the Tax
12 Reform Code, within the boundaries of the county at the rate
13 specified in subsection (b). The tax imposed under this section
14 shall be collected by the department at the same time and in the
15 same manner as provided in Article XII of the Tax Reform Code
16 and this subchapter.
17 (b) Rate of tax.--
18 (1) Except as provided in paragraph (2), the rate of tax
19 in counties, other than a county of the first class, shall be
20 at the rate of one and one-half cents per cigarette.
21 (2) The rate of tax in any county of the first class
22 shall be at the rate of two and one-half cents per cigarette.
23 Section 344. Licenses.
24 A license for the collection of the tax imposed by this
25 subchapter shall be issued by the department in the same manner
26 as is provided for in Article XII of the Tax Reform Code.
27 Section 345. Rules and regulations; collection costs.
28 (a) Regulations.--Rules and regulations shall be applicable
29 to the tax imposed under section 343 in the same manner as is in
30 Article XII of the Tax Reform Code.
19980H2547B3466 - 29 -
1 (b) Administrative costs.--The department, to cover its
2 costs of administration, shall be entitled to retain a sum equal
3 to the costs of administration but in no case shall the sum
4 exceed 1% of the revenues collected under this subchapter. When
5 the annual operating budget for the department is submitted to
6 the General Assembly, the department shall also submit to the
7 chairman and minority chairman of the Appropriations Committee
8 of the Senate and to the chairman and minority chairman of the
9 Appropriations Committee of the House of Representatives a
10 report of the actual sums retained for costs of collection in
11 the preceding fiscal year, together with all supporting details.
12 Section 346. Procedure and administration.
13 (a) Ordinance.--Any county desiring to impose the tax
14 authorized by section 343 shall adopt an ordinance. The
15 ordinance shall state the tax rate and refer to this subchapter.
16 Prior to adopting an ordinance imposing the tax authorized by
17 section 343, the governing body of the county shall give public
18 notice of its intent to adopt the ordinance in the manner
19 provided by section 4 of the Local Tax Enabling Act and shall
20 conduct at least one public hearing regarding the proposed
21 adoption of the ordinance.
22 (b) Notification to department.--A certified copy of the
23 county ordinance shall be delivered to the department by
24 September 1 of the year prior to the effective date thereof. The
25 county ordinance shall become effective on the January 1
26 following at least four months after the date of enactment of
27 the county ordinance.
28 (c) Delivery of repeal ordinance.--A certified copy of a
29 repeal ordinance shall be delivered to the department at least
30 30 days prior to the effective date of the repeal.
19980H2547B3466 - 30 -
1 Section 347. County cigarette tax funds.
2 There is hereby created for each county levying the tax under
3 section 343 the (proper name) County Cigarette Tax Fund. The
4 State Treasurer shall be custodian of the funds which shall be
5 subject to the provisions of law applicable to funds listed in
6 section 302 of the act of April 9, 1929 (P.L.343, No.176), known
7 as The Fiscal Code. Tax imposed under section 343 shall be
8 received by the department and paid to the State Treasurer and,
9 along with interest and penalties, less any collection costs
10 allowed under this subchapter and any refunds and credits paid,
11 shall be credited to the funds not less frequently than every
12 two weeks. All moneys in the funds, including, but not limited
13 to, moneys credited to the funds under this section, prior year
14 encumbrances and the interest earned thereon, shall not lapse or
15 be transferred to any other fund, but shall remain in the funds.
16 Pending their disbursement, moneys received on behalf of or
17 deposited into the funds shall be invested or reinvested as are
18 other moneys in the custody of the State Treasurer in the manner
19 provided by law. All earnings received from the investment or
20 reinvestment of the moneys under this section shall be credited
21 to the respective funds. The Auditor General shall periodically
22 audit the records of the department relative to its duties under
23 this section and shall furnish the results of such audit to any
24 county levying the tax under section 343.
25 Section 348. Disbursements.
26 On or before the tenth day of every month, the State
27 Treasurer shall make the disbursements on behalf of the county
28 imposing the tax out of the moneys which are, as of the last day
29 of the previous month, contained in the respective county
30 cigarette tax fund.
19980H2547B3466 - 31 -
1 SUBCHAPTERS F THROUGH I (RESERVED)
2 CHAPTER 5
3 CREDITS, EXEMPTIONS AND DEFERRALS
4 SUBCHAPTER A
5 CREDITS
6 Section 501. Credits.
7 The provisions of section 14 of the Local Tax Enabling Act
8 shall be used to determine any credits under the provisions of
9 this act for any taxes imposed under section 322 on the earned
10 income portion of the personal income tax or under section 331.
11 SUBCHAPTER B
12 TAX RELIEF FOR ELIGIBLE CLAIMANTS
13 Section 511. Subchapter definitions.
14 The following words and phrases when used in this subchapter
15 shall have the meanings given to them in this section unless the
16 context clearly indicates otherwise:
17 "Eligible claimant." A person who is within the class
18 established by the General Assembly, under the powers contained
19 in section 2(b)(ii) of Article VIII of the Constitution of
20 Pennsylvania, as being in need of and qualifying for special tax
21 treatment because of age under section 304(d)(1) of the act of
22 March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
23 1971, and who is:
24 (1) 65 years of age or older and owns a homestead
25 property solely or jointly with the person's spouse; or
26 (2) a widow or widower 50 years of age or older and the
27 sole owner of a homestead property.
28 "Homestead exemption." The exclusion from assessed value of
29 homestead property authorized in Chapter 7 in accordance with
30 section 2(b)(vi) of Article VIII of the Constitution of
19980H2547B3466 - 32 -
1 Pennsylvania.
2 "Homestead property." Real property which qualifies as a
3 homestead under the provisions of Chapter 7, except real
4 property which is rented or leased to a taxpayer.
5 Section 512. Special property tax relief for eligible
6 claimants.
7 (a) Legislative intent.--The General Assembly, in
8 recognition of the powers contained in section 2(b)(ii) of
9 Article VIII of the Constitution of Pennsylvania, which provides
10 for the establishing as a class or classes of subjects of
11 taxation the property or privileges of persons who, because of
12 age, are determined to be in need of special tax provisions,
13 hereby declares as its legislative intent and purpose to
14 implement such power under such constitutional provision by
15 establishing the special tax provisions in this subchapter.
16 (b) General rule.--A taxing authority may elect to provide
17 to eligible claimants an exclusion of up to 25% of the assessed
18 value of the homestead property.
19 (c) Administration.--
20 (1) Eligible claimants who are married are considered to
21 have one common homestead.
22 (2) No more than one exclusion may be claimed under
23 subsection (a) per homestead.
24 (3) Individual eligible claimants are considered to have
25 one homestead.
26 (d) Exclusions from assessed value are separate and
27 cumulative.--The exclusion for an eligible claimant under this
28 subchapter is separate and distinct from the homestead exemption
29 for which both eligible claimants and others owning homestead
30 property may qualify under Chapter 7. The exclusion authorized
19980H2547B3466 - 33 -
1 in this subchapter and the homestead exemption authorized in
2 Chapter 7 shall be cumulative. If the taxing authorities elect
3 to offer the exclusion for eligible claimants authorized in this
4 subchapter, an eligible claimant shall be entitled to receive
5 the benefit of exclusions from assessed value both under this
6 subchapter, adopted under section 2(b)(ii) of Article VIII of
7 the Constitution of Pennsylvania, and under the homestead
8 exemption in Chapter 7, adopted under section 2(b)(vi) of
9 Article VIII of the Constitution of Pennsylvania, as long as the
10 sum of the exclusions does not exceed the value of the
11 homestead.
12 Section 513. Application procedure.
13 Any person eligible for tax relief under section 512 may
14 apply for the exclusion by filing with the taxing authorities
15 the following documents:
16 (1) A statement of request for an exclusion from
17 assessed value.
18 (2) Certification that the claimant is the owner or that
19 the claimant and the claimant's spouse jointly are the owners
20 in fee simple of the homestead upon which the property taxes
21 are imposed.
22 (3) Evidence of the age of the claimant, and of the
23 death of the claimant's spouse, if applicable.
24 SUBCHAPTERS C THROUGH J (RESERVED)
25 CHAPTER 7
26 DISPOSITION OF TAX REVENUES
27 Section 701. Use of sales tax revenues.
28 (a) Counties.--Each county that imposes a sales and use tax
29 under this act shall use all revenues from the tax first to
30 offset any lost revenue to the county from the taxes prohibited
19980H2547B3466 - 34 -
1 under section 301(b) in an amount equal to the revenue the
2 county collected from the prohibited taxes in the immediately
3 preceding fiscal year and then to reduce or eliminate the county
4 real property tax by means of a homestead exemption.
5 (b) Increases in the tax rate.--In the year of
6 implementation of an increase the rate of a sales and use tax
7 imposed under this act, any sales and use tax revenue received
8 by the county shall be used as provided in subsection (a).
9 (c) Excess sales and use tax revenue received by counties.--
10 In the year of implementation of a tax authorized under this act
11 or an increase of a tax authorized under this act, any sales and
12 use tax revenue received by a county in excess of the amount
13 required to eliminate the tax on real property shall be
14 distributed to the school districts in the county. Each school
15 district shall receive a portion of the total disbursement to
16 school districts which is equal to the total disbursement to
17 school districts multiplied by the ratio of average daily
18 membership of the school district divided by the sum of the
19 average daily memberships of all school districts in the county.
20 For the purposes of this section, "average daily membership"
21 means "average daily membership" as defined by the act of March
22 10, 1949 (P.L.30, No.14), known as the Public School Code of
23 1949. For school districts located in more than one county, the
24 average daily membership shall be calculated by determining the
25 number of students in the district who reside in the county. The
26 total amount distributed by the county in the year of
27 implementation shall be distributed to the school districts in
28 the county each year thereafter and shall not be decreased as
29 long as the county participates under the provisions of this
30 act.
19980H2547B3466 - 35 -
1 (d) School districts under Chapter 3.--All sales and use tax
2 revenues received by any school district shall be used to reduce
3 the school district real property tax by means of a homestead
4 exemption.
5 Section 702. Use of income tax revenues.
6 (a) Use upon imposition of tax.--Each county, municipality
7 or school district that imposes an income tax under this act
8 shall use all revenues from the tax first to offset any lost
9 revenue to the county, municipality or school district from the
10 taxes prohibited under section 301(b) in an amount equal to the
11 revenue the county, municipality or school district collected
12 from the prohibited taxes in the immediately preceding fiscal
13 year and then to reduce or eliminate the county, municipality or
14 school district real property tax by means of a homestead
15 exemption.
16 (b) Increases in the tax rate.--In the year of
17 implementation of an increase in the rate of an income tax
18 imposed under this act, any income tax revenue received by the
19 county, municipality or school district shall be used as
20 provided in subsection (a).
21 (c) Excess income tax revenue received by counties.--In the
22 year of implementation of a tax authorized by this act or an
23 increase of a tax authorized under this act, any income tax
24 revenue received by a county in excess of the amount required to
25 eliminate the taxes listed in section 301(c) and eliminate the
26 tax on real property shall be distributed to the school
27 districts in the county. Each school district shall receive a
28 portion of the total disbursement to school districts which is
29 equal to the total disbursement to school districts multiplied
30 by the ratio of average daily membership of the school district
19980H2547B3466 - 36 -
1 divided by the sum of the average daily memberships of all
2 school districts in the county. For the purposes of this section
3 "average daily membership" means "average daily membership" as
4 defined by the act of March 10, 1949 (P.L.30, No.14), known as
5 the Public School Code of 1949. For school districts located in
6 more than one county, the average daily membership shall be
7 calculated by determining the number of students in the district
8 who reside in the county. The total amount distributed by the
9 county in the year of implementation shall be distributed to the
10 school districts in the county each year thereafter and shall
11 not be decreased as long as the county participates under the
12 provisions of this act.
13 Section 703. Methods of reducing real property tax.
14 (a) General rule.--Any taxing jurisdiction that receives
15 revenue from a county sales and use tax or an income tax levied
16 under the provisions of this act shall achieve any required
17 reduction of the real property tax by means of a homestead
18 exemption. The taxing jurisdiction may exclude from taxation by
19 means of the homestead exemption a fixed amount of the assessed
20 value of each homestead property in the taxing jurisdiction
21 within the limits, if any, imposed by Article VIII of the
22 Constitution of Pennsylvania, as provided in subsection (b). The
23 property tax shall be levied at the same millage rate as levied
24 by the taxing jurisdiction for the fiscal year immediately
25 preceding the year of implementation of the sales and use tax or
26 income tax, as appropriate, imposed under this act.
27 (b) Limitations.--
28 (1) A governing body may only reduce the real property
29 tax by means of the homestead exemption.
30 (2) (i) Any taxing jurisdiction which elects to reduce
19980H2547B3466 - 37 -
1 the real property tax by means of the homestead exemption
2 shall reduce the assessed value of each homestead in the
3 taxing jurisdiction by a fixed amount established by its
4 governing body up to a maximum which shall not exceed the
5 limits contained in section 2(b) of Article VIII of the
6 Constitution of Pennsylvania.
7 (ii) After a countywide revision of assessments
8 within a county where a taxing jurisdiction which has
9 established a homestead exemption is located, the
10 governing body of the taxing jurisdiction shall adjust
11 the amount of the homestead exemption as follows:
12 (A) if the county changes its assessment base by
13 applying a change in the established predetermined
14 ratio, the homestead exemption shall be adjusted by
15 the percentage change between the existing
16 predetermined ratio and the newly established
17 predetermined ratio; or
18 (B) if the county performs a countywide revision
19 of assessments by revaluing all properties and
20 applying an established predetermined ratio, the
21 homestead exemption shall be adjusted by dividing the
22 homestead exemption for the year preceding the
23 countywide revision of assessments by the common
24 level ratio and multiplying the quotient of that
25 calculation by the newly established predetermined
26 ratio.
27 (3) If after reducing the real property tax by means of
28 the homestead exemption there are any revenues remaining from
29 a sales and use tax or income tax imposed under this act, the
30 remaining revenues shall be used to further reduce the real
19980H2547B3466 - 38 -
1 property tax by means of a uniform reduction in the millage
2 rate.
3 (c) Definitions.--As used in this section, the following
4 words and phrases shall have the meanings given to them in this
5 subsection:
6 "Common level ratio." The ratio of assessed value to current
7 market value used generally in the county as last determined by
8 the State Tax Equalization Board under the act of June 27, 1947
9 (P.L.1046, No.447), referred to as the State Tax Equalization
10 Board Law.
11 "Established predetermined ratio." The ratio of assessed
12 value to market value established by the board of county
13 commissioners and uniformly applied in determining assessed
14 value in any year.
15 "Homestead." As defined in the act of , 1998 (P.L. ,
16 No. ), known as the Homestead Property Exclusion Act of 1998.
17 Section 704. Use of county cigarette tax revenue.
18 The revenue derived from the tax imposed under section 343
19 shall be used as follows:
20 (1) Fifty percent shall be distributed to school
21 districts within the county in the same manner as provided in
22 section 701(c).
23 (2) Except as provided in paragraph (3), any county,
24 other than a county of the first class, shall use the
25 remaining revenues to further reduce the real property tax by
26 means of a uniform reduction in millage rate.
27 (3) A county of the first class which imposes a tax
28 under section 343 shall use the remaining revenue from that
29 tax to reduce or eliminate the earned income tax imposed on
30 nonresidents.
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1 CHAPTER 9
2 REGISTER FOR CERTAIN TAXES
3 Section 901. Definitions.
4 The following words and phrases when used in this chapter
5 shall have the meanings given to them in this section unless the
6 context clearly indicates otherwise:
7 "Department." The Department of Community and Economic
8 Development of the Commonwealth.
9 Section 902. Register for taxes under this act.
10 (a) General rule.--It shall be the duty of the department to
11 have available an official continuing register supplemented
12 annually of all sales and use, personal income, and earned
13 income and net profits taxes levied under this act.
14 (b) Contents of register.--The register and its supplements
15 shall list:
16 (1) The counties, municipalities or school districts
17 levying personal income tax, earned income and net profits
18 tax or sales and use tax.
19 (2) The rate of tax as stated in the ordinance levying
20 the tax.
21 (3) The rate on taxpayers.
22 (4) The name and address of the tax officer responsible
23 for administering the collection of the tax and from whom
24 information, forms for reporting and copies of rules and
25 regulations are available.
26 Section 903. Information for register.
27 Information for the register shall be furnished by the chief
28 clerk or secretary of each county, municipality or school
29 district to the department in such manner and on such forms as
30 the department may prescribe. The information must be received
19980H2547B3466 - 40 -
1 by the department by certified mail no later than May 31 of each
2 year to show new tax enactments, repeals and changes. Failure to
3 comply with this date for filing may result in the omission of
4 the tax levy from the register for that year. Failure of the
5 department to receive information of taxes continued without
6 change may be construed by the department to mean that the
7 information contained in the previous register remains in force.
8 Section 904. Availability and effective period of register.
9 The department shall have the register, with such annual
10 supplements as may be required by new tax enactments, repeals or
11 changes, available upon request no later than July 1 of each
12 year. The effective period for each register shall be from July
13 1 of the year in which it is issued to June 30 of the following
14 year.
15 Section 905. Effect of nonfiling.
16 Employers shall not be required by any ordinance to withhold
17 from the compensation of their employees any personal income tax
18 or earned income and net profits tax imposed under the
19 provisions of this act which is not listed in the register or to
20 make reports of compensation in connection with taxes not so
21 listed. If the register is not available by July 1, the register
22 of the previous year shall continue temporarily in effect for an
23 additional period of not more than one year.
24 Section 906. Effect of chapter on liability of taxpayer.
25 The provisions of this chapter shall not affect the liability
26 of any taxpayer for taxes lawfully imposed under this act.
27 CHAPTER 51
28 MISCELLANEOUS PROVISIONS
29 Section 5101. Effective date.
30 This act shall take effect in 60 days.
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