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Pennsylvania House of Representatives
10/13/2024 11:02 PM
Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20130&cosponId=12703
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House of Representatives
Session of 2013 - 2014 Regular Session

MEMORANDUM

Posted: May 6, 2013 02:51 PM
From: Representative George Dunbar
To: All House members
Subject: Amending the Local Tax Enabling Act
 
In the near future I will be introducing legislation proposing an amendment to the Local Tax Enabling Act.

The two basic foundations of solid tax policy are that a tax should be fair and certain. Currently the Local Tax Enabling Act (LTEA) with regards to the Business Privilege Tax is neither fair nor certain. With that in mind I plan to introduce a bill to amend the LTEA to remove ambiguity and to make it absolutely clear when a municipality may tax a company performing work within its borders.

In a 2007 Pennsylvania Supreme Court Decision, Rendina, Inc. v. Harrisburg and the Harrisburg School District, the court reversed its previous position that a municipality cannot tax an entity that lacks permanent base of operation within its borders. This decision has created a great deal of uncertainty and in some cases has led to double taxation of some gross receipts.

My legislation would amend the LTEA to remove the ambiguities and prevent any double taxation that may exist presently. Specifically, this legislation will amend the Local Tax Enabling Act to provide that:

A local taxing authority may levy a tax on the privilege of doing business in the jurisdiction of the local taxing authority if sub clause (i) or (ii) applies:


  1. The privilege is exercised by conduction transactions in the jurisdiction of the levying local taxing authority for all or party of 15 or more calendar days within the calendar year.
  2. The privilege is exercised through a base of operations in the jurisdiction of the levying local tax authority. The gross receipts subject to this tax shall not include any receipts subject to a tax measured by such gross receipts which is imposed by any other jurisdiction.
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Introduced as HB1513