PRIOR PRINTER'S NOS. 143, 708, 784, PRINTER'S NO. 1422
809, 1048, 1401, 1413
No. 157 Session of 2005
INTRODUCED BY ARMSTRONG, VANCE, GORDNER, THOMPSON, PILEGGI,
EARLL, COSTA, KASUNIC, ORIE, LOGAN, ROBBINS, WONDERLING,
BOSCOLA, M. WHITE, WAUGH, WENGER, FUMO, PIPPY AND D. WHITE,
FEBRUARY 2, 2005
SENATE AMENDMENTS TO HOUSE AMENDMENTS, DECEMBER 13, 2005
AN ACT
1 Amending the act of December 31, 1965 (P.L.1257, No.511),
2 entitled "An act empowering cities of the second class,
3 cities of the second class A, cities of the third class,
4 boroughs, towns, townships of the first class, townships of
5 the second class, school districts of the second class,
6 school districts of the third class and school districts of
7 the fourth class including independent school districts, to
8 levy, assess, collect or to provide for the levying,
9 assessment and collection of certain taxes subject to maximum
10 limitations for general revenue purposes; authorizing the
11 establishment of bureaus and the appointment and compensation
12 of officers, agencies and employes to assess and collect such
13 taxes; providing for joint collection of certain taxes,
14 prescribing certain definitions and other provisions for
15 taxes levied and assessed upon earned income, providing for
16 annual audits and for collection of delinquent taxes, and
17 permitting and requiring penalties to be imposed and
18 enforced, including penalties for disclosure of confidential
19 information, providing an appeal from the ordinance or
20 resolution levying such taxes to the court of quarter
21 sessions and to the Supreme Court and Superior Court,"
22 further providing for delegation of taxing powers and
23 restrictions thereon; providing for local services taxes;
24 repealing provisions relating to emergency and municipal
25 services taxes and to continuation of occupational privilege
26 taxes; FURTHER PROVIDING FOR COLLECTION OF AND RESTRICTED USE <--
27 OF CERTAIN TAXES; and making editorial changes.
28 The General Assembly of the Commonwealth of Pennsylvania
29 hereby enacts as follows:
1 Section 1. Section 2 of the act of December 31, 1965
2 (P.L.1257, No.511), known as The Local Tax Enabling Act, amended
3 December 1, 2004 (P.L.1729, No.222), is amended to read:
4 Section 2. Delegation of Taxing Powers and Restrictions
5 Thereon.--The duly constituted authorities of the following
6 political subdivisions, cities of the second class, cities of
7 the second class A, cities of the third class, boroughs, towns,
8 townships of the first class, townships of the second class,
9 school districts of the second class, school districts of the
10 third class, and school districts of the fourth class, in all
11 cases including independent school districts, may, in their
12 discretion, by ordinance or resolution, for general revenue
13 purposes, levy, assess and collect or provide for the levying,
14 assessment and collection of such taxes as they shall determine
15 on persons, transactions, occupations, privileges, subjects and
16 personal property within the limits of such political
17 subdivisions, and upon the transfer of real property, or of any
18 interest in real property, situate within the political
19 subdivision levying and assessing the tax, regardless of where
20 the instruments making the transfers are made, executed or
21 delivered or where the actual settlements on such transfer take
22 place. The taxing authority may provide that the transferee
23 shall remain liable for any unpaid realty transfer taxes imposed
24 by virtue of this act. Each local taxing authority may, by
25 ordinance or resolution, exempt any person whose total income
26 from all sources is less than twelve thousand dollars ($12,000)
27 per annum from the per capita or similar head tax, occupation
28 tax [and emergency and municipal services tax], or earned income
29 tax, or any portion thereof, and may adopt regulations for the
30 processing of claims for exemptions. Each political subdivision
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1 shall by ordinance or resolution exempt any person from the
2 local services tax whose total income from all sources is less
3 than twelve thousand dollars ($12,000) for the calendar year in
4 which the local services tax is levied, and shall adopt
5 regulations for the processing of refund claims for a local
6 services tax paid by any person who is eligible for the
7 exemption. The regulations shall be consistent with 53 Pa.C.S.
8 §§ 8425 (relating to refunds of overpayments) and 8426 (relating
9 to interest on overpayment). The date of overpayment for a local
10 services tax shall be the date the tax was deducted and withheld
11 at source. Refunds made within seventy-five days of a refund
12 request or seventy-five days after the last day the employer is
13 required to remit the local services tax for the last quarter of
14 the calendar year under section 9 of this act, whichever is
15 later, shall not be subject to interest imposed under 53 Pa.C.S.
16 § 8426. It is the intent of this section that a political
17 subdivision or its tax officer determine eligibility for the
18 exemption and provide refunds to exempt persons from the local
19 services tax and that employers shall not be responsible for
20 processing the exemption or exempting any employe from the local
21 services tax. For purposes of this section, "income from all
22 sources" shall mean "income" as defined in section 3 of the act
23 of March 11, 1971 (P.L.104, No.3), known as the Senior Citizens
24 Rebate and Assistance Act. The Department of Community and
25 Economic Development shall develop uniform forms to be used by
26 political subdivisions to facilitate the refund of the tax to
27 any person eligible for the exemption. Such local authorities
28 shall not have authority by virtue of this act:
29 (1) To levy, assess and collect or provide for the levying,
30 assessment and collection of any tax on the transfer of real
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1 property when the transfer is by will or mortgage or the
2 intestate laws of this Commonwealth or on a transfer by the
3 owner of previously occupied residential premises to a builder
4 of new residential premises when such previously occupied
5 residential premises is taken in trade by such builder as part
6 of the consideration from the purchaser of a new previously
7 unoccupied single family residential premises or on a transfer
8 between corporations operating housing projects pursuant to the
9 housing and redevelopment assistance law and the shareholders
10 thereof, or on a transfer between nonprofit industrial
11 development agencies and industrial corporations purchasing from
12 them, or on transfer to or from nonprofit industrial development
13 agencies, or on a transfer between husband and wife, or on a
14 transfer between persons who were previously husband and wife
15 but who have since been divorced; provided such transfer is made
16 within three months of the date of the granting of the final
17 decree in divorce, or the decree of equitable distribution of
18 marital property, whichever is later, and the property or
19 interest therein, subject to such transfer, was acquired by the
20 husband and wife, or husband or wife, prior to the granting of
21 the final decree in divorce, or on a transfer between parent and
22 child or the spouse of such a child, or between parent and
23 trustee for the benefit of a child or the spouse of such child,
24 or on a transfer between a grandparent and grandchild or the
25 spouse of such grandchild, or on a transfer between brother and
26 sister or brother and brother or sister and sister or the spouse
27 of such brother or sister, or on a transfer to a conservancy
28 which possesses a tax-exempt status pursuant to section
29 501(c)(3) of the Internal Revenue Code, and which has as its
30 primary purpose the preservation of land for historic,
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1 recreational, scenic, agricultural or open space opportunities,
2 by and between a principal and straw party for the purpose of
3 placing a mortgage or ground rent upon the premises, or on a
4 correctional deed without consideration, or on a transfer to the
5 United States, the Commonwealth of Pennsylvania, or to any of
6 their instrumentalities, agencies or political subdivisions, by
7 gift, dedication or deed in lieu of condemnation, or deed of
8 confirmation in connection with condemnation proceedings, or
9 reconveyance by the condemning body of the property condemned to
10 the owner of record at the time of condemnation which
11 reconveyance may include property line adjustments provided said
12 reconveyance is made within one year from the date of
13 condemnation, leases, or on a conveyance to a trustee under a
14 recorded trust agreement for the express purpose of holding
15 title in trust as security for a debt contracted at the time of
16 the conveyance under which the trustee is not the lender and
17 requiring the trustee to make reconveyance to the grantor-
18 borrower upon the repayment of the debt, or a transfer within a
19 family from a sole proprietor family member to a family farm
20 corporation, or in any sheriff sale instituted by a mortgagee in
21 which the purchaser of said sheriff sale is the mortgagee who
22 instituted said sale, or on a privilege, transaction, subject,
23 occupation or personal property which is now or does hereafter
24 become subject to a State tax or license fee;
25 (2) To levy, assess or collect a tax on the gross receipts
26 from utility service of any person or company whose rates and
27 services are fixed and regulated by the Pennsylvania Public
28 Utility Commission or on any public utility services rendered by
29 any such person or company or on any privilege or transaction
30 involving the rendering of any such public utility service;
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1 (3) Except on sales of admission to places of amusement or
2 on sales or other transfers of title or possession of property,
3 to levy, assess or collect a tax on the privilege of employing
4 such tangible property as is now or does hereafter become
5 subject to a State tax; and for the purposes of this clause,
6 real property rented for camping purposes shall not be
7 considered a place of amusement.
8 (4) To levy, assess and collect a tax on goods and articles
9 manufactured in such political subdivision or on the by-products
10 of manufacture, or on minerals, timber, natural resources and
11 farm products produced in such political subdivision or on the
12 preparation or processing thereof for use or market, or on any
13 privilege, act or transaction related to the business of
14 manufacturing, the production, preparation or processing of
15 minerals, timber and natural resources, or farm products, by
16 manufacturers, by producers and by farmers with respect to the
17 goods, articles and products of their own manufacture,
18 production or growth, or on any privilege, act or transaction
19 relating to the business of processing by-products of
20 manufacture, or on the transportation, loading, unloading or
21 dumping or storage of such goods, articles, products or by-
22 products; except that local authorities may levy, assess and
23 collect [an emergency and municipal] a local services tax and
24 taxes on the occupation, per capita and earned income or net
25 profits of natural persons engaged in the above activities
26 whether doing business as individual proprietorship or as
27 members of partnerships or other associations;
28 (5) To levy, assess or collect a tax on salaries, wages,
29 commissions, compensation and earned income of nonresidents of
30 the political subdivisions: Provided, That this limitation (5)
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1 shall apply only to school districts of the second, third and
2 fourth classes;
3 (6) To levy, assess or collect a tax on personal property
4 subject to taxation by counties or on personal property owned by
5 persons, associations and corporations specifically exempted by
6 law from taxation under the county personal property tax law:
7 Provided, That this limitation (6) shall not apply to cities of
8 the second class;
9 (7) To levy, assess or collect a tax on membership in or
10 membership dues, fees or assessment of charitable, religious,
11 beneficial or nonprofit organizations including but not limited
12 to sportsmens, recreational, golf and tennis clubs, girl and boy
13 scout troops and councils;
14 (8) To levy, assess or collect any tax on a mobilehome or
15 house trailer subject to a real property tax unless the same tax
16 is levied, assessed and collected on other real property in the
17 political subdivision.
18 (9) To levy, assess or collect any tax on individuals for
19 the privilege of engaging in an occupation ([emergency and
20 municipal] local services tax) except that such a tax may be
21 levied, assessed and collected only by the political subdivision
22 of the taxpayer's place of employment.
23 [Payment of any emergency and municipal services tax to any
24 political subdivision by any person pursuant to an ordinance or
25 resolution passed or adopted under the authority of this act
26 shall be no less than ten dollars ($10) nor more than fifty-two
27 dollars ($52) on each person for each calendar year.
28 The situs of such tax shall be the place of employment, but,
29 in the event a person is engaged in more than one occupation, or
30 an occupation which requires his working in more than one
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1 political subdivision during the calendar year, the priority of
2 claim to collect such emergency and municipal services tax shall
3 be in the following order: first, the political subdivision in
4 which a person maintains his principal office or is principally
5 employed; second, the political subdivision in which the person
6 resides and works, if such a tax is levied by that political
7 subdivision; third, the political subdivision in which a person
8 is employed and which imposes the tax nearest in miles to the
9 person's home. The place of employment shall be determined as of
10 the day the taxpayer first becomes subject to the tax during the
11 calendar year.
12 It is the intent of this provision that no person shall pay
13 more than fifty-two dollars ($52) in any calendar year as an
14 emergency and municipal services tax irrespective of the number
15 of political subdivisions within which such person may be
16 employed within any given calendar year.
17 In case of dispute, a tax receipt of the taxing authority for
18 that calendar year declaring that the taxpayer has made prior
19 payment which constitutes prima facie certification of payment
20 to all other political subdivisions.] The following apply:
21 (i) For any payroll period in a calendar year, a political
22 subdivision levying a local services tax pursuant to an
23 ordinance or a resolution under the authority of this act shall
24 collect no more than the pro rata share of the tax levied on a
25 person for a calendar year determined by dividing the tax levied
26 on a person for the calendar year by the number of payroll
27 periods established by the employer for the calendar year. For
28 purposes of determining the pro rata share, employers shall
29 round down the amount of the tax collected each payroll period
30 to the nearest one-hundredth of a dollar. The local services tax
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1 shall be no more than fifty-two dollars ($52) on each person for
2 each calendar year, irrespective of the number of political
3 subdivisions within which a person may be employed.
4 (ii) If a school district levied and collected an emergency
5 and municipal services tax on the effective date of this
6 subclause, the school district may continue to levy a local
7 services tax in the same amount the school district collected on
8 the effective date of this subclause, subject to the pro rata
9 limitation based on payroll periods of subclause (i). However,
10 if a municipality located in whole or in part within the school
11 district subsequently levies the local services tax, the school
12 district may only collect five dollars ($5) on taxpayers
13 employed within the municipality each calendar year, subject to
14 the limitations of this clause. A school district that did not
15 levy or collect a local services tax on the effective date of
16 this subclause shall be prohibited from levying a local services
17 tax. If a school district and a municipality located in whole or
18 in part within the school district both levy a local services
19 tax, the school district's pro rata share of the aggregate local
20 services taxes levied on taxpayers employed within the
21 municipality shall be collected by the municipality or its tax
22 officer based on pay periods, and paid to the school district on
23 a quarterly basis within sixty days of receipt by the
24 municipality or its tax officer. If a municipality located in
25 whole or in part within a school district does not levy and
26 collect the local services tax, the school district may provide
27 for collection of the local services tax as provided in section
28 10 of this act.
29 (iii) No taxpayer shall be subject to the payment of the
30 local services tax by more than one political subdivision during
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1 each payroll period as established by subclause (iv).
2 (iv) The situs of the tax shall be the place of employment
3 on the first day the taxpayer becomes subject to the tax during
4 each payroll period in a calendar year, but, in the event a
5 person is engaged in more than one occupation, that is,
6 concurrent employment, or an occupation which requires the
7 taxpayer working in more than one political subdivision during a
8 payroll period, the priority of claim to collect the local
9 services tax shall be in the following order: first, the
10 political subdivision in which a person maintains the person's
11 principal office or is principally employed; second, the
12 political subdivision in which the person resides and works, if
13 the tax is levied by that political subdivision; and third, the
14 political subdivision in which a person is employed and which
15 imposes the tax nearest in miles to the person's home.
16 (v) In the case of concurrent employment, an employer shall
17 refrain from withholding the local services tax if the employe
18 provides a recent pay statement from a principal employer that
19 includes the name of the employer, the length of the pay period
20 and the amount of the local services tax withheld, which is
21 accompanied by a statement from the employe that the pay
22 statement is from the employe's principal employer and the
23 employe will notify other employers of a change in principal
24 place of employment within two weeks of its occurrence. The
25 Department of Community and Economic Development shall develop a
26 uniform employe statement form.
27 (vi) Political subdivisions shall adopt regulations for the
28 processing of refund claims for overpaid local services taxes
29 for any calendar year. The regulations shall be consistent with
30 53 Pa.C.S. §§ 8425 and 8426. The date of overpayment for a local
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1 services tax shall be the date the tax was deducted and withheld
2 at source. Refunds made within seventy-five days of a refund
3 request or seventy-five days after the last day the employer is
4 required to remit the local services tax for the last quarter of
5 the calendar year under section 9 of this act, whichever is
6 later, shall not be subject to interest imposed under 53 Pa.C.S.
7 § 8426. Political subdivisions shall only provide refunds for
8 amounts overpaid in a calendar year that exceed one dollar ($1).
9 (vii) The Department of Community and Economic Development
10 may provide suggested forms and technical assistance to
11 facilitate the administration of the local services tax for
12 political subdivisions and reduce the burden of implementation,
13 accounting and compliance for employers and taxpayers.
14 (10) To levy, assess or collect a tax on admissions to
15 motion picture theatres: Provided, That this limitation (10)
16 shall not apply to cities of the second class.
17 (11) To levy, assess or collect a tax on the construction of
18 or improvement to residential dwellings or upon the application
19 for or issuance of permits for the construction of or
20 improvements to residential dwellings.
21 (12) To levy, assess and collect a mercantile or business
22 privilege tax on gross receipts or part thereof which are: (i)
23 discounts allowed to purchasers as cash discounts for prompt
24 payment of their bills; (ii) charges advanced by a seller for
25 freight, delivery or other transportation for the purchaser in
26 accordance with the terms of a contract of sale; (iii) received
27 upon the sale of an article of personal property which was
28 acquired by the seller as a trade-in to the extent that the
29 gross receipts in the sale of the article taken in trade does
30 not exceed the amount of trade-in allowance made in acquiring
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1 such article; (iv) refunds, credits or allowances given to a
2 purchaser on account of defects in goods sold or merchandise
3 returned; (v) Pennsylvania sales tax; (vi) based on the value of
4 exchanges or transfers between one seller and another seller who
5 transfers property with the understanding that property of an
6 identical description will be returned at a subsequent date;
7 however, when sellers engaged in similar lines of business
8 exchange property and one of them makes payment to the other in
9 addition to the property exchanged, the additional payment
10 received may be included in the gross receipts of the seller
11 receiving such additional cash payments; (vii) of sellers from
12 sales to other sellers in the same line where the seller
13 transfers the title or possession at the same price for which
14 the seller acquired the merchandise; or (viii) transfers between
15 one department, branch or division of a corporation or other
16 business entity of goods, wares and merchandise to another
17 department, branch or division of the same corporation or
18 business entity and which are recorded on the books to reflect
19 such interdepartmental transactions.
20 (13) To levy, assess or collect an amusement or admissions
21 tax on membership, membership dues, fees or assessments,
22 donations, contributions or monetary charges of any character
23 whatsoever paid by the general public, or a limited or selected
24 number thereof, for such persons to enter into any place,
25 indoors or outdoors, to engage in any activities, the
26 predominant purpose or nature of which is exercise, fitness,
27 health maintenance, improvement or rehabilitation, health or
28 nutrition education, or weight control.
29 (14) Except by cities of the second class, to levy, assess
30 or collect a tax on payroll amounts generated as a result of
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1 business activity.
2 (15) Except by cities of the second class in which a sports
3 stadium or arena that has received public funds in connection
4 with its construction or maintenance is located, to levy, assess
5 and collect a publicly funded facility usage fee upon those
6 nonresident individuals who use such facility to engage in an
7 athletic event or otherwise render a performance for which they
8 receive remuneration.
9 (16) To levy, assess or collect an amusement or admissions
10 tax on the charge imposed upon a patron for the sale of
11 admission to or for the privilege of admission to a bowling
12 alley or bowling lane to engage in one or more games of bowling.
13 Section 2. Section 7 of the act, amended August 11, 1967
14 (P.L.228, No.83) and October 9, 1967 (P.L.361, No.160), is
15 amended to read:
16 Section 7. Filing of Certified Copies of Ordinances and
17 Resolutions.--When an ordinance or a resolution is first passed
18 or adopted by a political subdivision imposing a tax or license
19 fee under the authority of this act, an exact printed or
20 typewritten copy thereof, certified to by the secretary of the
21 taxing body, shall be filed with the [Department of Community
22 Affairs] Department of Community and Economic Development within
23 fifteen days after the same becomes effective.
24 Any secretary or person acting as the clerk or secretary of
25 the taxing body of any political subdivision during the meeting
26 at which an ordinance or resolution imposing a tax or license
27 fee is passed or adopted as herein provided who shall fail to
28 file the certified copy or statement relative thereto with the
29 [Department of Community Affairs] Department of Community and
30 Economic Development as herein required, shall, upon summary
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1 conviction thereof in the county in which the political
2 subdivision is located, be sentenced to pay a fine of not less
3 than five dollars ($5) nor more than twenty-five dollars ($25),
4 and the costs of prosecution.
5 Section 3. Section 8 of the act, amended December 1, 2004
6 (P.L.1729, No.222), is amended to read:
7 Section 8. Limitations on Rates of Specific Taxes.--No taxes
8 levied under the provisions of this act shall be levied by any
9 political subdivision on the following subjects exceeding the
10 rates specified in this section:
11 (1) Per capita, poll or other similar head taxes, ten
12 dollars ($10).
13 (2) On each dollar of the whole volume of business
14 transacted by wholesale dealers in goods, wares and merchandise,
15 one mill, by retail dealers in goods, wares and merchandise and
16 by proprietors of restaurants or other places where food, drink
17 and refreshments are served, one and one-half mills; except in
18 cities of the second class, where rates shall not exceed one
19 mill on wholesale dealers and two mills on retail dealers and
20 proprietors. No such tax shall be levied on the dollar volume of
21 business transacted by wholesale and retail dealers derived from
22 the resale of goods, wares and merchandise, taken by any dealer
23 as a trade-in or as part payment for other goods, wares and
24 merchandise, except to the extent that the resale price exceeds
25 the trade-in allowance.
26 (3) On wages, salaries, commissions and other earned income
27 of individuals, one percent.
28 (4) On retail sales involving the transfer of title or
29 possession of tangible personal property, two percent.
30 (5) On the transfer of real property, one percent.
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1 (6) On admissions to places of amusement, athletic events
2 and the like, and on motion picture theatres in cities of the
3 second class, ten percent.
4 (7) Flat rate occupation taxes not using a millage or
5 percentage as a basis, ten dollars ($10).
6 (8) [Emergency and municipal] Local services taxes, fifty-
7 two dollars ($52).
8 (9) On admissions to ski facilities, ten percent. The tax
9 base upon which the tax shall be levied shall not exceed forty
10 percent of the cost of the lift ticket. The lift ticket shall
11 include all costs of admissions to the ski facility.
12 (10) On admissions to golf courses, ten percent. The tax
13 base upon which the tax shall be levied shall not exceed forty
14 percent of the greens fee. The greens fee shall include all
15 costs of admissions to the golf course.
16 (12) On payrolls, fifty-five hundredths percent.
17 Except as otherwise provided in this act, at any time two
18 political subdivisions shall impose any one of the above taxes
19 on the same person, subject, business, transaction or privilege,
20 located within both such political subdivisions, during the same
21 year or part of the same year, under the authority of this act
22 then the tax levied by a political subdivision under the
23 authority of this act shall, during the time such duplication of
24 the tax exists, except as hereinafter otherwise provided, be
25 one-half of the rate, as above limited, and such one-half rate
26 shall become effective by virtue of the requirements of this act
27 from the day such duplication becomes effective without any
28 action on the part of the political subdivision imposing the tax
29 under the authority of this act. When any one of the above taxes
30 has been levied under the provisions of this act by one
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1 political subdivision and a subsequent levy is made either for
2 the first time or is revived after a lapse of time by another
3 political subdivision on the same person, subject, business,
4 transaction or privilege at a rate that would make the combined
5 levies exceed the limit allowed by this subdivision, the tax of
6 the second political subdivision shall not become effective
7 until the end of the fiscal year for which the prior tax was
8 levied, unless:
9 (1) Notice indicating its intention to make such levy is
10 given to the first taxing body by the second taxing body as
11 follows: (i) when the notice is given to a school district it
12 shall be given at least forty-five days prior to the last day
13 fixed by law for the levy of its school taxes; (ii) when given
14 to any other political subdivision it shall be prior to the
15 first day of January immediately preceding, or if a last day for
16 the adoption of the budget is fixed by law, at least forty-five
17 days prior to such last day; or
18 (2) Unless the first taxing body shall indicate by
19 appropriate resolution its desire to waive notice requirements
20 in which case the levy of the second taxing body shall become
21 effective on such date as may be agreed upon by the two taxing
22 bodies.
23 It is the intent and purpose of this provision to limit rates
24 of taxes referred to in this section so that the entire burden
25 of one tax on a person, subject, business, transaction or
26 privilege shall not exceed the limitations prescribed in this
27 section: Provided, however, That any two political subdivisions
28 which impose any one of the above taxes, on the same person,
29 subject, business, transaction or privilege during the same year
30 or part of the same year may agree among themselves that,
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1 instead of limiting their respective rates to one-half of the
2 maximum rate herein provided, they will impose respectively
3 different rates, the total of which shall not exceed the maximum
4 rate as above permitted.
5 Notwithstanding the provisions of this section, any city of
6 the second class A may enact a tax upon wages, salaries,
7 commissions and other earned income of individuals resident
8 therein, not exceeding one percent, even though a school
9 district levies a similar tax on the same person provided that
10 the aggregate of both taxes does not exceed two percent. [In the
11 case of duplication of emergency and municipal services taxes by
12 both a school district, other than a school district of the
13 first class A, and another taxing body, the school district's
14 share of the tax shall not exceed the amount of a tax on the
15 privilege of engaging in an occupation collected by the school
16 district as of the effective date of this paragraph. In the case
17 where a school district did not levy a tax on the privilege of
18 engaging in an occupation on the effective date of this
19 paragraph, the school district may impose a future levy not to
20 exceed five dollars ($5). A school district of the first class A
21 shall not levy, assess or collect an emergency and municipal
22 services tax.]
23 Section 4. Section 9 of the act, amended December 12, 1968
24 (P.L.1203, No.377), is amended to read:
25 Section 9. Register for Earned Income and [Occupational
26 Privilege] Local Services Taxes.--It shall be the duty of the
27 [Department of Community Affairs] Department of Community and
28 Economic Development to have available an official continuing
29 register supplemented annually of all earned income and
30 [occupational privilege] local services taxes levied under
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1 authority of this act. The register and its supplements,
2 hereinafter referred to as the register, shall list such
3 jurisdictions levying earned income [and/or occupational
4 privilege] and local services taxes, the rate of the tax as
5 stated in the tax levying ordinance or resolution, and the
6 effective rate on resident and nonresident taxpayers, if
7 different from the stated rate because of a coterminous levy,
8 the name and address of the officer responsible for
9 administering the collection of the tax and from whom
10 information, forms for reporting and copies of rules and
11 regulations are available. With each jurisdiction listed, all
12 jurisdictions making coterminous levies shall also be noted and
13 their tax rates shown.
14 Information for the register shall be furnished by the
15 secretary of each taxing body to the [Department of Community
16 Affairs] Department of Community and Economic Development in
17 such manner and on such forms as the [Department of Community
18 Affairs] Department of Community and Economic Development may
19 prescribe. The information must be received by the [Department
20 of Community Affairs] Department of Community and Economic
21 Development by certified mail not later than May 31 of each year
22 to show new tax enactments, repeals and changes. Failure to
23 comply with this date for filing may result in the omission of
24 the levy from the register for that year. Failure of the
25 [Department of Community Affairs] Department of Community and
26 Economic Development to receive information of taxes continued
27 without change may be construed by the department to mean that
28 the information contained in the previous register remains in
29 force.
30 The [Department of Community Affairs] Department of Community
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1 and Economic Development shall have the register with such
2 annual supplements as may be required by new tax enactments,
3 repeals or changes available upon request not later than July 1
4 of each year. The effective period for each register shall be
5 from July 1 of the year in which it is issued to June 30 of the
6 following year.
7 Employers shall not be required by any local ordinance to
8 withhold from the wages, salaries, commissions or other
9 compensation of their employes any tax imposed under the
10 provisions of this act, which is not listed in the register, or
11 make reports of wages, salaries, commissions or other
12 compensation in connection with taxes not so listed: Provided,
13 That if the register is not available by July 1, the register of
14 the previous year shall continue temporarily in effect for an
15 additional period not to exceed one year. The provisions of this
16 section shall not affect the liability of any taxpayer for taxes
17 lawfully imposed under this act.
18 Ordinances or resolutions imposing earned income or
19 [occupational privilege] local services taxes under authority of
20 this act may contain provisions requiring employers doing
21 business within the jurisdiction of the political subdivision
22 imposing the tax to withhold the tax from the compensation of
23 those of their employes who are subject to the tax: Provided,
24 That no employer shall be held liable for failure to withhold
25 earned income taxes or for the payment of such withheld tax
26 money to a political subdivision other than the political
27 subdivision entitled to receive such money if such failure to
28 withhold or such incorrect transmittal of withheld taxes arises
29 from incorrect information as to the employe's place of
30 residence submitted by the employe: And provided further, That
20050S0157B1422 - 19 -
1 [employers shall not be required by any local ordinance to
2 withhold from compensation for any one of their employes for the
3 occupational privilege tax more than one time in any fiscal
4 period:] no employer shall be held liable for failure to
5 withhold the local services tax or for the payment of the
6 withheld tax money to a political subdivision if the failure to
7 withhold taxes arises from incorrect information submitted by
8 the employe as to the employe's place or places of employment,
9 the employe's principal office or where the employe is
10 principally employed: And provided further, That an employer
11 shall not be liable for payment of the local services tax in an
12 amount exceeding the amount withheld by the employer if the
13 employer complies with the provisions of section 2(9) of this
14 act and remits the amount so withheld in accordance with this
15 section: And provided further, That the Department of Community
16 and Economic Development may provide suggested forms and
17 technical assistance to facilitate the administration of the
18 local services tax for political subdivisions and reduce the
19 burden of implementation, accounting and compliance for
20 employers and taxpayers: And provided further, That the
21 [occupational privilege] local services tax shall be applicable
22 to employment in the period beginning January 1, of the current
23 year and ending December 31 of the current year, except that
24 taxes imposed for the first time shall become effective from the
25 date specified in the ordinance or resolution, and the tax shall
26 continue in force on a calendar year basis[.]: And provided
27 further, That employers shall be required to remit the local
28 services taxes thirty days after the end of each quarter of a
29 calendar year.
30 Section 5. Section 19 of the act, amended October 4, 1978
20050S0157B1422 - 20 -
1 (P.L.930, No.177), is amended to read:
2 Section 19. Collection of Delinquent Per Capita, Occupation,
3 Occupational Privilege, Emergency and Municipal Services, Local
4 Services and Earned Income Taxes from Employers, etc.--The tax
5 collector shall demand, receive and collect from all
6 corporations, political subdivisions, associations, companies,
7 firms or individuals, employing persons owing delinquent per
8 capita, or occupation, occupational privilege, emergency and
9 municipal services, local services and earned income taxes, or
10 whose spouse owes delinquent per capita, occupation,
11 occupational privilege, emergency and municipal services, local
12 services and earned income taxes, or having in possession unpaid
13 commissions or earnings belonging to any person or persons owing
14 delinquent per capita, occupation, occupational privilege,
15 emergency and municipal services, local services and earned
16 income taxes, or whose spouse owes delinquent per capita,
17 occupation, occupational privilege, emergency and municipal
18 services, local services and earned income taxes, upon the
19 presentation of a written notice and demand certifying that the
20 information contained therein is true and correct and containing
21 the name of the taxable or the spouse thereof and the amount of
22 tax due. Upon the presentation of such written notice and
23 demand, it shall be the duty of any such corporation, political
24 subdivision, association, company, firm or individual to deduct
25 from the wages, commissions or earnings of such individual
26 employes, then owing or that shall within sixty days thereafter
27 become due, or from any unpaid commissions or earnings of any
28 such taxable in its or his possession, or that shall within
29 sixty days thereafter come into its or his possession, a sum
30 sufficient to pay the respective amount of the delinquent per
20050S0157B1422 - 21 -
1 capita, occupation, occupational privilege, emergency and
2 municipal services, local services and earned income taxes and
3 costs, shown upon the written notice or demand, and to pay the
4 same to the tax collector of the taxing district in which such
5 delinquent tax was levied within sixty days after such notice
6 shall have been given. No more than ten percent of the wages,
7 commissions or earnings of the delinquent taxpayer or spouse
8 thereof may be deducted at any one time for delinquent per
9 capita, occupation, occupational privilege, emergency and
10 municipal services, local services and earned income taxes and
11 costs. Such corporation, political subdivision, association,
12 firm or individual shall be entitled to deduct from the moneys
13 collected from each employe the costs incurred from the extra
14 bookkeeping necessary to record such transactions, not exceeding
15 two percent of the amount of money so collected and paid over to
16 the tax collector. Upon the failure of any such corporation,
17 political subdivision, association, company, firm or individual
18 to deduct the amount of such taxes or to pay the same over to
19 the tax collector, less the cost of bookkeeping involved in such
20 transaction, as herein provided, within the time hereby
21 required, such corporation, political subdivision, association,
22 company, firm or individual shall forfeit and pay the amount of
23 such tax for each such taxable whose taxes are not withheld and
24 paid over, or that are withheld and not paid over together with
25 a penalty of ten percent added thereto, to be recovered by an
26 action of assumpsit in a suit to be instituted by the tax
27 collector, or by the proper authorities of the taxing district,
28 as debts of like amount are now by law recoverable, except that
29 such person shall not have the benefit of any stay of execution
30 or exemption law. The tax collector shall not proceed against a
20050S0157B1422 - 22 -
1 spouse or his employer until he has pursued collection remedies
2 against the delinquent taxpayer and his employer under this
3 section.
4 Section 6. Section 20 of the act is amended to read:
5 Section 20. Collection of Delinquent Per Capita, Occupation,
6 Occupational Privilege, Emergency and Municipal Services, Local
7 Services and Earned Income Taxes from the Commonwealth.--Upon
8 presentation of a written notice and demand under oath or
9 affirmation, to the State Treasurer or any other fiscal officer
10 of the State, or its boards, authorities, agencies or
11 commissions, it shall be the duty of the treasurer or officer to
12 deduct from the wages then owing, or that shall within sixty
13 days thereafter become due to any employe, a sum sufficient to
14 pay the respective amount of the delinquent per capita,
15 occupation, occupational privilege, emergency and municipal
16 services, local services and earned income taxes and costs shown
17 on the written notice. The same shall be paid to the tax
18 collector of the taxing district in which said delinquent tax
19 was levied within sixty days after such notice shall have been
20 given.
21 Section 7. Section 22.1 of the act, added November 30, 2004
22 (P.L.1520, No.192), is amended to read:
23 Section 22.1. Costs of Collection of Delinquent Per Capita,
24 Occupation, Occupational Privilege, Emergency and Municipal
25 Services, Local Services and Earned Income Taxes.--(a) A person,
26 public employe or private agency designated by a governing body
27 of a political subdivision to collect and administer a per
28 capita, occupation, occupational privilege, emergency and
29 municipal services, local services or earned income tax may
30 impose and collect the reasonable costs incurred to provide
20050S0157B1422 - 23 -
1 notices of delinquency or to implement similar procedures
2 utilized to collect delinquent taxes from a taxpayer as approved
3 by the governing body of the political subdivision. Reasonable
4 costs collected may be retained by the person, public employe or
5 private agency designated to collect the tax as agreed to by the
6 governing body of the political subdivision. An itemized
7 accounting of all costs collected shall be remitted to the
8 political subdivision on an annual basis.
9 (b) Costs related to the collection of unpaid per capita,
10 occupation [or], occupational privilege, emergency and municipal
11 services or local services taxes may only be assessed, levied
12 and collected for five years from the last day of the calendar
13 year in which the tax was due.
14 (c) A delinquent taxpayer may not bring an action for
15 reimbursement, refund or elimination of reasonable costs of
16 collection assessed or imposed prior to the effective date of
17 this section. Additional costs may not be assessed on delinquent
18 taxes collected prior to the effective date of this section.
19 Section 8. Sections 22.4 and 22.5 of the act, added December
20 1, 2004 (P.L.1729, No.222), are amended to read:
21 [Section 22.4. Emergency and Municipal Services Taxes.--Any
22 reference in any act or law to an occupational privilege tax
23 shall mean the emergency and municipal services taxes as
24 provided for in this act.
25 Section 22.5. Restricted Use.--(a) Any municipality
26 deriving funds from the emergency and municipal services tax may
27 only use the funds for:
28 (1) police, fire and/or emergency services;
29 (2) road construction and/or maintenance; or
30 (3) reduction of property taxes.
20050S0157B1422 - 24 -
1 (b) For the purpose of the emergency and municipal services
2 tax, the term municipality does not include a school district.]
3 Section 9. The act is amended by adding a section to read:
4 Section 22.6. Restricted Use.--(a) Any municipality
5 deriving funds from the local services tax shall use no less
6 than twenty-five percent of the funds for police, fire and
7 emergency services.
8 (b) For the purpose of the local services tax, the term
9 "municipality" does not include a school district.
10 Section 10. Any ordinance or resolution providing for the
11 levying, assessment or collection of a tax on individuals for
12 the privilege of engaging in an occupation which has been
13 enacted by a political subdivision prior to December 1, 2004,
14 shall continue in full force and effect, without reenactment, as
15 if such tax had been levied, assessed or collected as a local
16 services tax under section 2(9) of the act. All references in
17 any ordinance or resolution to a tax on the privilege of
18 engaging in an occupation shall be deemed to be a reference to a
19 local services tax for the purposes of the act.
20 Section 11. All emergency and local MUNICIPAL services taxes <--
21 levied for the calendar year beginning on January 1, 2005, shall
22 remain in effect for the calendar year beginning on January 1,
23 2005, and ending December 31, 2005, and are not otherwise
24 altered.
25 Section 12. The EXCEPT AS SET FORTH IN SECTION 12.1 OF THIS <--
26 ACT, THE amendment or addition of the following provisions shall
27 apply to taxes levied for calendar year 2006 and each year
28 thereafter:
29 (1) The amendment of section 2 of the act.
30 (2) The amendment of section 8 of the act.
20050S0157B1422 - 25 -
1 (3) The amendment of section 9 of the act, except for
2 any editorial amendment changing the reference from the
3 Department of Community Affairs to the Department of
4 Community and Economic Development.
5 (4) The amendment of section 19 of the act.
6 (5) The amendment of section 20 of the act.
7 (6) The amendment of section 22.1 of the act.
8 (7) The amendment of section 22.4 of the act.
9 (8) The amendment of section 22.5 of the act.
10 (9) The addition of section 22.6 of the act.
11 SECTION 12.1. THE FOLLOWING PROVISIONS SHALL NOT APPLY TO A <--
12 POLITICAL SUBDIVISION WHICH, ON THE EFFECTIVE DATE OF THIS <--
13 SECTION NOVEMBER 30, 2004, WAS IMPOSING A TAX ON THE PRIVILEGE <--
14 OF ENGAGING IN AN OCCUPATION:
15 (1) THE AMENDMENT OF SECTION 2(9) OF THE ACT.
16 (2) THE ADDITION OF SECTION 22.6 OF THE ACT.
17 SECTION 12.2. THE AMENDMENT OF THE INTRODUCTORY PARAGRAPH OF <--
18 SECTION 2 OF THE ACT SHALL NOT APPLY, UNTIL JANUARY 1, 2007, TO
19 A MUNICIPALITY WHICH REDUCED ITS REAL ESTATE PROPERTY TAX BY AT
20 LEAST 25% UPON ADOPTION OF AN ORDINANCE PURSUANT TO THE ACT OF
21 DECEMBER 1, 2004 (P.L.1729, NO.222), ENTITLED "AN ACT AMENDING
22 THE ACT OF DECEMBER 31, 1965 (P.L.1257, NO.511), ENTITLED 'AN
23 ACT EMPOWERING CITIES OF THE SECOND CLASS, CITIES OF THE SECOND
24 CLASS A, CITIES OF THE THIRD CLASS, BOROUGHS, TOWNS, TOWNSHIPS
25 OF THE FIRST CLASS, TOWNSHIPS OF THE SECOND CLASS, SCHOOL
26 DISTRICTS OF THE SECOND CLASS, SCHOOL DISTRICTS OF THE THIRD
27 CLASS AND SCHOOL DISTRICTS OF THE FOURTH CLASS INCLUDING
28 INDEPENDENT SCHOOL DISTRICTS, TO LEVY, ASSESS, COLLECT OR TO
29 PROVIDE FOR THE LEVYING, ASSESSMENT AND COLLECTION OF CERTAIN
30 TAXES SUBJECT TO MAXIMUM LIMITATIONS FOR GENERAL REVENUE
20050S0157B1422 - 26 -
1 PURPOSES; AUTHORIZING THE ESTABLISHMENT OF BUREAUS AND THE
2 APPOINTMENT AND COMPENSATION OF OFFICERS, AGENCIES AND EMPLOYES
3 TO ASSESS AND COLLECT SUCH TAXES; PROVIDING FOR JOINT COLLECTION
4 OF CERTAIN TAXES, PRESCRIBING CERTAIN DEFINITIONS AND OTHER
5 PROVISIONS FOR TAXES LEVIED AND ASSESSED UPON EARNED INCOME,
6 PROVIDING FOR ANNUAL AUDITS AND FOR COLLECTION OF DELINQUENT
7 TAXES, AND PERMITTING AND REQUIRING PENALTIES TO BE IMPOSED AND
8 ENFORCED, INCLUDING PENALTIES FOR DISCLOSURE OF CONFIDENTIAL
9 INFORMATION, PROVIDING AN APPEAL FROM THE ORDINANCE OR
10 RESOLUTION LEVYING SUCH TAXES TO THE COURT OF QUARTER SESSIONS
11 AND TO THE SUPREME COURT AND SUPERIOR COURT,' FURTHER PROVIDING
12 FOR DELEGATION OF TAXING POWERS AND RESTRICTIONS THEREON;
13 PROVIDING FOR NONRESIDENT SPORTS FACILITY USAGE FEE, FOR PARKING
14 TAX RATES AND FOR PAYROLL TAXES; FURTHER PROVIDING FOR
15 LIMITATIONS ON RATES OF SPECIFIC TAXES AND FOR THE APPOINTMENT
16 OF A SINGLE COLLECTOR OF TAXES; FURTHER PROVIDING FOR THE
17 APPLICABILITY OF PETITIONS UNDER THE ACT OF JULY 10, 1987
18 (P.L.246, NO.47), KNOWN AS THE MUNICIPALITIES FINANCIAL RECOVERY
19 ACT; AND MAKING A REPEAL."
20 Section 13. Repeals are as follows:
21 (1) The General Assembly declares that the repeal under
22 paragraph (2) is necessary to effectuate the amendment of
23 section 2(9) of the act.
24 (2) Section 6 of the act of December 1, 2004 (P.L.1729,
25 No.222), entitled "An act amending the act of December 31,
26 1965 (P.L.1257, No.511), entitled 'An act empowering cities
27 of the second class, cities of the second class A, cities of
28 the third class, boroughs, towns, townships of the first
29 class, townships of the second class, school districts of the
30 second class, school districts of the third class and school
20050S0157B1422 - 27 -
1 districts of the fourth class including independent school
2 districts, to levy, assess, collect or to provide for the
3 levying, assessment and collection of certain taxes subject
4 to maximum limitations for general revenue purposes;
5 authorizing the establishment of bureaus and the appointment
6 and compensation of officers, agencies and employes to assess
7 and collect such taxes; providing for joint collection of
8 certain taxes, prescribing certain definitions and other
9 provisions for taxes levied and assessed upon earned income,
10 providing for annual audits and for collection of delinquent
11 taxes, and permitting and requiring penalties to be imposed
12 and enforced, including penalties for disclosure of
13 confidential information, providing an appeal from the
14 ordinance or resolution levying such taxes to the court of
15 quarter sessions and to the Supreme Court and Superior
16 Court,' further providing for delegation of taxing powers and
17 restrictions thereon; providing for nonresident sports
18 facility usage fee, for parking tax rates and for payroll
19 taxes; further providing for limitations on rates of specific
20 taxes and for the appointment of a single collector of taxes;
21 further providing for the applicability of petitions under
22 the act of July 10, 1987 (P.L.246, No.47), known as the
23 Municipalities Financial Recovery Act; and making a repeal,"
24 is repealed.
25 Section 14. This act shall take effect immediately.
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