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06/19/2021 11:46 PM
Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20190&cosponId=29729
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House of Representatives
Session of 2019 - 2020 Regular Session

MEMORANDUM

Posted: June 4, 2019 09:16 AM
From: Representative Robert E. Merski
To: All House members
Subject: Payroll Tax for Municipalities
 
In 2003, Pittsburgh was facing a challenging fiscal situation: it had just entered Act 47 financial recovery status and was expecting a $60 million budget shortfall. It was for that reason that Pittsburgh officials proposed a payroll tax that would boost its general fund without asking the ordinary taxpayer for a greater cut of his hard-earned money. In 2004, the General Assembly granted Pittsburgh permission to levy a payroll tax. While the payroll tax remains useful to Pittsburgh, accounting for about 12 percent of its revenues, it is still the only municipality with the authority to levy such a tax. Other municipalities, each with unique fiscal challenges, could benefit from the extra budgetary flexibility that would come with such a tax without raising property taxes.

That is why I am introducing legislation to permit municipalities to levy the 0.55 percent payroll tax. While I recognize there is not a one-size-fits-all approach to municipal budgeting, this legislation would simply allow municipalities to implement one more tool to boost their general funds, as it would allow but not require the payroll tax. This would be beneficial to municipalities in early intervention to avoid Act 47.

Please join me in giving municipalities an additional option to rise to the challenges that they face. Your consideration and co-sponsorship are appreciated.