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Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20170&cosponId=23513
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House Co-Sponsorship Memoranda

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House of Representatives
Session of 2017 - 2018 Regular Session

MEMORANDUM

Posted: April 5, 2017 10:08 AM
From: Representative Michael Peifer
To: All House members
Subject: Resolution to Study State Collection of Local EIT
 
In the near future, I will be introducing legislation that requires the Pennsylvania Department of Community and Economic Development, in consultation with the Pennsylvania Department of Revenue and the Independent Fiscal Office to study potential cost savings and efficiencies resulting from the consolidation of local earned income taxes by the Commonwealth's 69 local tax districts into a central tax collection repository within the Department of Revenue.

Local earned income taxes (EIT) are authorized by municipalities and school districts and represent their principle source of non-property tax revenue. Act 32 of 2008 brought sweeping changes to the EIT collection and distribution process in Pennsylvania, reducing the number of collectors in the Commonwealth from 560 to no more than 69. The Act created tax collection districts and tax collection committees in order to ensure local oversight of EIT collection and distribution within each tax collection district.

Pennsylvania's Legislative Budget and Finance Committee and the Department of Community and Economic Development recently reported that the enactment of Act 32 increased collection revenues by approximately $173 million without raising rates. However, considering that school districts and municipalities were losing an estimated $237 million annually prior to Act 32, I believe that it is prudent to explore alternative collection policies at the state level that further maximize tax collection efficiencies, effectiveness and convenience without increasing revenues to fund our school districts and municipalities.

Please consider joining me as a co-sponsor of this legislation. Thank you.



Introduced as HR291