PRINTER'S NO. 623
No. 555 Session of 1983
INTRODUCED BY WILSON, TRELLO, MORRIS, GRUPPO, DeVERTER, WASS,
COLE, SCHULER, GREENWOOD, REBER, GEIST, CESSAR, ARTY, POTT,
LASHINGER, KUKOVICH, D. R. WRIGHT, PUNT, LUCYK, PHILLIPS,
MADIGAN, CLYMER, HOEFFEL, BURNS, REINARD, BUNT AND
D. W. SNYDER, MARCH 23, 1983
REFERRED TO COMMITTEE ON FINANCE, MARCH 23, 1983
AN ACT
1 Providing for taxation by school districts, counties and
2 municipal corporations; providing for sales, income and other
3 taxes; providing penalties; and making repeals.
4 TABLE OF CONTENTS
5 PART I
6 PRELIMINARY PROVISIONS
7 Chapter 1. General Provisions
8 Section 101. Short title.
9 Section 102. Definitions.
10 PART II
11 SCHOOL DISTRICTS
12 Chapter 3. Personal Income Tax
13 Section 301. Tax authorization.
14 Section 302. Official tax register.
15 Section 303. Withholding.
16 Section 304. Computation of withholding.
17 Section 305. Notice to employers and withholding of taxes.
1 Chapter 5. Net Mercantile Tax
2 Section 501. Definitions.
3 Section 502. Imposition of tax.
4 Section 503. Tax base.
5 Section 504. Business located in more than one district.
6 Section 505. School district lien.
7 Section 506. Rules and regulations.
8 Section 507. Examination and investigation.
9 Section 508. Standard forms.
10 Chapter 7. Amusement Tax
11 Section 701. Tax authorization.
12 Chapter 9. Real Estate Transfer Tax
13 Section 901. Tax authorization.
14 Chapter 11. Miscellaneous Provisions
15 Section 1101. Continuance of certain tax rates.
16 Section 1102. Tax yield limitation.
17 Section 1103. Collection of taxes.
18 Section 1104. Collection agreements.
19 Section 1105. Construction of part.
20 Section 1106. Schedule of implementation of taxes.
21 Section 1107. Referenda.
22 Section 1108. Nonpreemption.
23 Section 1109. Rent reductions.
24 Section 1110. Rebudgeting.
25 PART III
26 COUNTY TAXATION
27 Chapter 15. Sales Tax
28 Section 1501. Tax authorization.
29 Section 1502. Collection of tax.
30 Section 1503. Use of tax receipts.
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1 Section 1504. Nonpreemption.
2 PART IV
3 (Reserved)
4 PART V
5 MUNICIPAL CORPORATION TAXATION
6 Chapter 31. General Provisions
7 Section 3101. Taxing powers and restrictions.
8 Section 3102. Vacation of tax ordinances and resolutions by
9 State tax measures.
10 Section 3103. Appeals by taxpayers.
11 Section 3104. Limitations on rates of specific taxes.
12 Section 3105. Required rent reductions.
13 Section 3106. Register for income and municipal services
14 charges.
15 Section 3107. Collection of taxes.
16 Section 3108. Cooperation by Department of Revenue with
17 municipal corporations.
18 Section 3109. Audits of income taxes.
19 Section 3110. Audits of taxes other than income taxes.
20 Section 3111. Rebudgeting.
21 Chapter 33. Income Taxes
22 Section 3301. Definitions and construction.
23 Section 3302. Tax year.
24 Section 3303. Payment of taxes.
25 Section 3304. Final return and payment of balance due.
26 Section 3305. Income not subject to withholding.
27 Section 3306. Employers.
28 Section 3307. Returns and withholding statements.
29 Section 3308. Liability.
30 Section 3309. Filing of return.
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1 Section 3310. Powers and duties of tax collection officer.
2 Section 3311. Suit for collection of tax.
3 Section 3312. Interest and penalties.
4 Section 3313. Fines and penalties.
5 Section 3314. Payment of tax to other municipal corporations
6 or states as credit or deduction.
7 Chapter 35. Tax Limitation, Collection and Penalties
8 Section 3501. Tax limitations.
9 Section 3502. Collection of delinquent income taxes and
10 municipal services charges from employers.
11 Section 3503. Collection of delinquent income taxes and
12 municipal services charges from the
13 Commonwealth.
14 Section 3504. Penalties.
15 Section 3505. Nonpreemption.
16 Chapter 37. Property Tax Exemption
17 Section 3701. Property tax exemption.
18 PART VI
19 MISCELLANEOUS PROVISIONS
20 Chapter 99. Savings Provisions, Repeals and Effective Date
21 Section 9901. Saving clause and limitations.
22 Section 9902. Repeals.
23 Section 9903. Nonseverability.
24 Section 9904. Application of act.
25 Section 9905. Effective date.
26 The General Assembly of the Commonwealth of Pennsylvania
27 hereby enacts as follows:
28 PART I
29 PRELIMINARY PROVISIONS
30 CHAPTER 1
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1 GENERAL PROVISIONS
2 Section 101. Short title.
3 This act shall be known and may be cited as the Local Tax
4 Reform Act.
5 Section 102. Definitions.
6 The following words and phrases when used in this act shall
7 have the meanings given to them in this section unless the
8 context clearly indicates otherwise:
9 "Counties." A county of the second, second class A, third,
10 fourth, fifth, sixth, seventh or eighth class.
11 "Department." The Department of Revenue.
12 "Municipal corporation." Any city of the second class, city
13 of the second class A, city of the third class, borough,
14 incorporated town, town or township of the first or second
15 class.
16 "School district." A school district of the first class A,
17 second, third or fourth class.
18 PART II
19 SCHOOL DISTRICTS
20 CHAPTER 3
21 PERSONAL INCOME TAX
22 Section 301. Tax authorization.
23 (a) Imposition and rate.--For the school fiscal year 1984-
24 1985, or if appropriate, calendar year 1984 and thereafter, a
25 school district may impose a tax on the personal income of
26 residents of up to 2% consistent with the provisions of Article
27 III of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
28 Reform Code of 1971. A school district may impose the tax
29 provided for under this subsection, but only at a rate that will
30 provide revenues substantially equal to the total of the
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1 projected revenues lost through elimination of taxes previously
2 authorized under the act of December 31, 1965 (P.L.1257,
3 No.511), known as The Local Tax Enabling Act, or in any other
4 similar statute, together with the revenues lost through the
5 repeal of section 679 of the act of March 10, 1949 (P.L.30,
6 No.14), known as the Public School Code of 1949.
7 (b) Additional tax and limitation.--A school district may
8 impose an additional percentage of the tax on the personal
9 income of residents, provided that there is a reduction in real
10 property tax rates or assessment values sufficient to reduce
11 projected real property tax revenues by an amount substantially
12 equal to the revenue raised by the additional income tax. The
13 combined rate of tax authorized by this subsection and the tax
14 authorized by subsection (a) shall not exceed 2%.
15 Section 302. Official tax register.
16 (a) Register of taxes.--It shall be the duty of the
17 Department of Community Affairs to have available an official
18 register of all taxes levied under the authority of section 301.
19 The register shall list those school districts levying the tax,
20 the rate of the tax as stated in the levying ordinance or
21 resolution and the name and address of the officer or entity
22 responsible for administering the collection of the tax and from
23 whom information, forms for reporting and copies of rules and
24 regulations are available.
25 (b) Register information.--Information for the register
26 shall be furnished by each board to the Department of Community
27 Affairs in the manner and form as the Department of Community
28 Affairs may prescribe. Failure to comply with this section for
29 filing may result in the omission of the levy from the register
30 for that year. Failure of the Department of Community Affairs to
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1 receive information of taxes continued without change may be
2 construed by the Department of Community Affairs to mean that
3 the information contained in the previous register remains in
4 force.
5 (c) Availability.--The Department of Community Affairs shall
6 have the register with those annual supplements as may be
7 required by new tax enactments, repeals or changes available
8 upon request not later than July 1 of each year. The effective
9 period for each register shall be from July 1 of the year in
10 which it is issued to June 30 of the following year.
11 (d) Time of submission of information.--For those school
12 districts operating on a calendar year basis, the information
13 must be provided to the Department of Community Affairs by
14 certified mail by November 30 of each year. The Department of
15 Community Affairs shall compile the provided information in an
16 official supplementary register, which shall likewise be
17 available upon request by January 1 of each year. The effective
18 period for the official supplementary register shall be January
19 1 of the year in which it is issued to December 31 of the
20 following year.
21 Section 303. Withholding.
22 Upon a school district's compliance with section 302,
23 employers not within the district imposing the tax shall within
24 30 days after the register has been published withhold the tax
25 from the compensation of those of their employees who are
26 subject to the tax. Employers, located within the geographic
27 limits of the district, shall within 30 days after receiving
28 notification by the school district by certified mail, withhold
29 the tax from the compensation of those employees who are subject
30 to the tax. No employer shall, however, be held liable for
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1 failure to withhold the tax or for the payment of withheld tax
2 money if the failure to withhold or the incorrect transmittal of
3 withheld taxes arises from incorrect information as to the
4 employee's place of residence submitted by the employee. This
5 section shall not affect the liability of any taxpayer for the
6 payment of any taxes lawfully imposed under section 301.
7 Section 304. Computation of withholding.
8 Employers, upon a school district's compliance with section
9 303, shall deduct and withhold from the compensation for each
10 payroll period of each employee who is a resident of that school
11 district, a tax computed in a manner as to result, so far as
12 practicable, in withholding from the employee's compensation
13 during the calendar year an amount substantially equivalent to
14 the tax reasonably estimated to be due for that year with
15 respect to his compensation.
16 Section 305. Notice to employers and withholding of taxes.
17 (a) Amount of withholding.--A school district may provide
18 written notice to employers of its imposition of the tax levied
19 under section 301. Subject to the foregoing, the ordinance
20 levying the tax shall provide for withholding, collecting and
21 enforcement procedures which are not inconsistent with the
22 provisions of Chapter 33.
23 (b) Commonwealth employees.--It shall be the duty of the
24 State Treasurer or other appropriate State official at the time
25 of payment of the salary, wage or compensation to any officer or
26 employee of the Commonwealth, within the school district, to
27 deduct any tax imposed by the school district on the salary,
28 wage or other compensation paid by the Commonwealth to any
29 officer or employee thereof.
30 CHAPTER 5
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1 NET MERCANTILE TAX
2 Section 501. Definitions.
3 The following words and phrases when used in this chapter
4 shall have the meanings given to them in this section unless the
5 context clearly indicates otherwise:
6 "Business."
7 (1) The carrying on or exercising for gain or profit
8 within this Commonwealth by any person of any trade,
9 business, profession, vocation or making sales to persons
10 within this Commonwealth or of any commercial or financial
11 service or business, including but not limited to, brokers,
12 wholesale dealers or wholesale vendors, retail dealers or
13 retail vendors.
14 (2) The term shall not include the following:
15 (i) Any business of a nonprofit organization which
16 exists for the purpose of collective bargaining or of
17 dealing with employers concerning grievances, terms or
18 conditions of employment or of other mutual aid or
19 protection in relation to employment.
20 (ii) Any business conducted by a nonprofit
21 unincorporated association organized for religious,
22 charitable or educational purposes.
23 (iii) Any business or other organization exempt from
24 property taxes as of the effective date of this act.
25 (iv) Any authority created and organized under and
26 pursuant to any act of assembly.
27 (v) The business of any insurance company,
28 association or exchange, or any fraternal benefit or
29 beneficial society of any other state under the laws of
30 which insurance companies, associations or exchanges or
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1 fraternal benefit or beneficial societies of this
2 Commonwealth doing business in that other state would be
3 subjected by reason of the tax imposed by this act to
4 additional or further taxes, fines, penalties or license
5 fees by that other state and any employment for a wage or
6 salary.
7 (vi) Any family farm corporation, as defined in
8 section 602.2 of the act of March 4, 1971 (P.L.6, No.2),
9 known as the Tax Reform Code of 1971.
10 (vii) Any person engaged in manufacturing who
11 qualifies for an exemption from the tax imposed pursuant
12 to Article VI of the act of March 4, 1971 (P.L.6, No.2),
13 known as the Tax Reform Code of 1971.
14 (viii) Landlords, but only for purposes of rent
15 collections. The term "landlord" shall mean any taxpayer
16 who owns real property, who grants to a person the right
17 to use or occupy real property or any part thereof in
18 exchange for consideration.
19 "Consideration." All proceeds received, whether in cash,
20 credits or property of any kind or nature given in exchange for
21 the right to use or occupy real property in which the person
22 does not have legal or equitable title.
23 "Person." Any corporation, partnership, limited partnership,
24 copartnership, natural individual or individuals meeting one or
25 more of the following:
26 (1) Doing business in the school district.
27 (2) Having capital or property employed in the school
28 district.
29 (3) Owning property in the school district.
30 "Taxable year." The calendar year or the fiscal year.
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1 Section 502. Imposition of tax.
2 A school district, levying the additional percentage of
3 income tax provided for under section 301(b), shall, in
4 conjunction therewith, impose the net mercantile tax. This tax
5 shall be imposed for the privilege of carrying on any business,
6 trade, occupation, profession, vocation, or any other
7 commercial, industrial or agricultural activity in the school
8 district and shall be levied at a rate which produces revenues
9 substantially equal to the reduction in nonresidential real
10 property taxes.
11 Section 503. Tax base.
12 The tax shall be levied on each dollar of the net volume of
13 business transacted within the school district. For purposes of
14 this chapter "net volume of business" shall be the whole dollar
15 volume of business transacted within the district less the
16 following deductions:
17 (1) Cost of goods sold, as claimed and allowable for
18 Federal tax purposes.
19 (2) Cost of labor, as claimed and allowable for Federal
20 tax purposes.
21 (3) Cost of housing or rent including, but not limited
22 to, depreciation claimed for Pennsylvania income tax
23 purposes.
24 Section 504. Business located in more than one district.
25 In the event that a business taxable under this chapter is
26 located in more than one school district, the tax for each
27 district in which the business is located shall be levied by the
28 district on that portion of the tax base allocated to the
29 district by the compensation paid in the district to the total
30 payroll of the business claimed for Pennsylvania tax purposes.
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1 Section 505. School district lien.
2 A school district is hereby empowered to enter a lien against
3 any business, liable for the tax imposed under this section,
4 which fails to pay the tax levied pursuant to this chapter. The
5 lien shall be consistent with that applicable to the
6 Commonwealth under Article IV of the act of March 4, 1971
7 (P.L.6, No.2), known as the Tax Reform Code of 1971, and shall
8 be recorded with the county prothonotary in the county wherein
9 the business is located.
10 Section 506. Rules and regulations.
11 The school district is hereby authorized to prescribe, adopt,
12 promulgate and enforce rules and regulations pertaining to the
13 administration and enforcement of this chapter and the
14 collection of taxes and penalties imposed hereunder. The school
15 district shall have these rules and regulations printed and
16 shall distribute them to any person upon request.
17 Section 507. Examination and investigation.
18 (a) General rule.--The school district is hereby authorized
19 to examine the books, papers and records and to investigate the
20 character of the business of any person in order to verify the
21 accuracy of any report made, or if no report was made, to
22 ascertain and settle the tax imposed by this chapter. Every
23 person is hereby directed and required to give to the district
24 the means, facilities and opportunity for an examination and
25 investigation. Any information gained by the school district as
26 a result of any returns, investigations or verifications
27 required to be made by this chapter, shall be confidential,
28 except for official purposes and any person divulging such
29 information shall, upon conviction thereof, be guilty of a
30 misdemeanor and shall be sentenced to pay a fine of not less
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1 than $100 or more than $1,000 and costs of prosecution, or to
2 undergo imprisonment for not more than six months, or both. The
3 school district shall by regulation define official purposes for
4 the use of this information.
5 (b) Information reports.--For the first year that a school
6 district imposes the tax authorized by section 501, or for the
7 first year in which a person becomes subject to said tax, the
8 school district may require each business to file an information
9 report. Said report shall enumerate the taxpayer's whole dollar
10 volume of business, its cost of goods sold, its cost of labor
11 and its cost of housing or rent in the district in the preceding
12 year. All information received through the report shall be
13 confidential.
14 Section 508. Standard forms.
15 It shall be the duty of the department to develop standard
16 forms to be used by school districts in the collection of taxes
17 under this chapter.
18 CHAPTER 7
19 AMUSEMENT TAX
20 Section 701. Tax authorization.
21 A school district, in addition to any other taxes authorized
22 by law, may provide by ordinance or resolution for the levying
23 of a tax on sales of admission to places of amusement consistent
24 with Part V. The rate of tax on admissions to places of
25 amusement shall not exceed 5% of the price of admission.
26 CHAPTER 9
27 REAL ESTATE TRANSFER TAX
28 Section 901. Tax authorization.
29 A school district, in addition to any other taxes authorized
30 by law, may provide by ordinance or resolution for the levying
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1 of a tax on the transfer of real property consistent with Part
2 V. The rate of tax on the transfer of real property shall not
3 exceed 0.5%.
4 CHAPTER 11
5 MISCELLANEOUS PROVISIONS
6 Section 1101. Continuance of certain tax rates.
7 If a school district levied and collected a tax in its fiscal
8 year 1982-1983 or, if appropriate, calendar year 1982 that
9 exceeds the rate provided for in Chapter 7 or 9, the school
10 district may continue to levy and collect the tax at the rate
11 imposed as of its fiscal year 1982-1983 or, if appropriate,
12 calendar year 1982.
13 Section 1102. Tax yield limitation.
14 (a) In relation to property tax reductions, assessments and
15 certain revenue losses.--For the school fiscal year 1984-1985
16 or, if appropriate, calendar year 1984 and thereafter, no school
17 district shall impose the personal income tax authorized by
18 Chapter 3 at a rate that would yield an amount greater than the
19 budgeted amount in dollars of residential property tax reduction
20 plus the budgeted dollar reduction in taxes levied under the act
21 of December 31, 1965 (P.L.1257, No.511), known as The Local Tax
22 Enabling Act, or in any other similar statute, together with the
23 revenues lost through the repeal of section 679 of the act of
24 March 10, 1949 (P.L.30, No.14), known as the Public School Code
25 of 1949. For the school fiscal year 1984-1985 or, if
26 appropriate, calendar year 1984 and thereafter, no school
27 district shall impose the net mercantile tax authorized by
28 Chapter 5 at a rate that would yield an amount greater than the
29 budgeted amount in dollars of nonresidential property tax
30 reduction. Thereafter, the proper proportion between the school
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1 personal income tax and the net mercantile tax shall be
2 determined by taking the percentage of the combined net
3 mercantile tax and personal income tax and increasing or
4 decreasing the net mercantile tax rate by the increase or
5 decrease in the percentage that the total assessed value of all
6 nonresidential real property bears to the total assessed value
7 of all taxable real property in the school district.
8 (b) In relation to tax revenues and personal income.--A
9 school district imposing taxes under Chapters 3 and 5 shall not
10 realize an increase in total tax revenues for any fiscal year
11 which exceeds the tax revenues collected for the preceding
12 fiscal year by a greater percentage than the percentage increase
13 in total personal income of Pennsylvania residents during the
14 preceding calendar year as published by the United States
15 Department of Commerce, Bureau of Economic Analysis. In the
16 event a school district deems it necessary to exceed the limit
17 provided in this subsection, it shall be required to appear at a
18 public hearing before the court of common pleas in the county in
19 which it is situated. The board shall give public notice of this
20 hearing and of the proposed tax rates to be implemented only for
21 the upcoming fiscal year by:
22 (1) publishing the notice twice in a "newspaper of
23 general circulation," as defined in 45 Pa.C.S. § 101
24 (relating to definitions), which is published and circulated
25 and which has a bona fide paid circulation equal to or
26 greater than any newspaper published in the school district;
27 and
28 (2) posting a copy of the notice prominently in each
29 public school located within the district. This notice shall
30 be published and posted at least 30 but not more than 60 days
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1 prior to the date of the public hearing. It shall be the
2 responsibility of the school district to show to the court of
3 common pleas, by a preponderance of evidence, that the
4 proposed increase is in fact necessary and substantiated.
5 Should the court of common pleas deem the proposed increase
6 valid and effective, the school district may levy taxes at
7 the proposed rate only for the school fiscal year in
8 question.
9 Section 1103. Collection of taxes.
10 The collection of taxes under Chapters 7 and 9 shall be,
11 where appropriate and not inconsistent, in accordance with
12 Chapter 33.
13 Section 1104. Collection agreements.
14 School districts may elect to enter into agreements with the
15 department for the collection of taxes imposed under this part.
16 Section 1105. Construction of part.
17 (a) General rule.--Nothing contained in this part shall be
18 construed to limit the power of a school district to initiate
19 its own system for the collection of taxes imposed under section
20 301. A school district shall not be prohibited from offering a
21 discount on the total amount of taxes due in the case where the
22 taxpayer elects to prepay his school taxes. A school district
23 may also provide for discounts to employers who timely remit
24 taxes withheld on behalf of the district.
25 (b) Utilization of other taxes.--It is the intent of the
26 General Assembly that this part be construed in accordance with
27 section 3101 (relating to taxing powers and restrictions) and
28 that school districts be permitted to utilize any taxes not
29 otherwise prohibited by that section.
30 Section 1106. Schedule of implementation of taxes.
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1 A school district may continue to levy any tax it levied for
2 the school fiscal year 1982-1983 or, if appropriate, calendar
3 year 1982, under the act of December 31, 1965 (P.L.1257,
4 No.511), known as The Local Tax Enabling Act, until school
5 fiscal year 1984-1985 or, if appropriate, calendar year 1984.
6 Section 1107. Referenda.
7 (a) Procedure.--The board, upon petition of not less than
8 10% of the total amount of electors who cast ballots in the
9 preceding election of school directors, shall arrange for a
10 binding referendum at one general, municipal or primary election
11 occurring immediately prior to commencement of the next school
12 fiscal year. This referendum shall be conducted pursuant to the
13 act of June 3, 1937 (P.L.1333, No.320), known as the
14 Pennsylvania Election Code.
15 (b) Ballot question.--This referendum shall be conducted in
16 cases where the board fails to reach a decision concerning the
17 election of the school district to reduce or eliminate real
18 property taxes; the board decides the district will not reduce
19 or eliminate real property taxes and the voters want to override
20 that decision; or the board, after participation in the program
21 to reduce or eliminate real property taxes for not less than two
22 years and has given public notice to that effect not less than
23 six months prior to the proposed effective date of withdrawal,
24 elects to discontinue said participation. The ballot questions
25 shall be as appropriate from the following:
26 Shall the (name of school district) participate in the
27 public school financing reform program, providing for the
28 elimination of certain taxes, with a replacement for lost
29 revenues from an imposition of a limited personal income tax
30 and a limited net mercantile tax, beginning in the next
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1 school fiscal year and thereafter?
2 Shall the (name of school district) continue to
3 participate in the public school financing reform program as
4 previously adopted by the (name of school district) board of
5 directors?
6 Section 1108. Nonpreemption.
7 The authority to levy taxes under Chapters 3, 5, 7 and 9
8 shall not be preempted or otherwise invalidated by any other
9 State tax or local tax ordinance.
10 Section 1109. Rent reductions.
11 (a) Notice.--Within 30 days after receipt of his real
12 property tax bill, a landlord shall disclose in writing to each
13 residential or commercial tenant who has occupied a rental unit
14 for more than 45 days, the reduction in real property taxes, if
15 any, under this chapter which is attributable to the tenant's
16 unit. The amount of tax reduction attributable to each unit
17 shall be based upon allocated square footage occupied or other
18 reasonable criteria. The rental amount specified in any lease
19 shall reflect any reduction in real property taxes pursuant to
20 this chapter.
21 (b) Amount of reduction.--Each landlord shall reduce rental
22 payments required of each residential and commercial tenant in
23 an amount equal to any reduction or elimination of the school
24 real property tax which is allocable to real estate leased by
25 said tenant. The rental reduction shall be calculated by
26 dividing the total real property tax reduction or elimination
27 applicable to said real property during the course of the
28 initial tax year by the number of rental payments required of
29 the tenant during said tax year unless an alternate method of
30 calculation is provided for in the written lease. In cases where
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1 more than one rental unit is situated upon any tract of real
2 estate affected by said tax reduction or elimination, the
3 landlord shall reduce the rent of each tenant in a proportion
4 equal to the total amount of rent that the rental unit leased by
5 the tenant bears to the total amount of rent of all rental units
6 situated upon said tract of real estate unless an alternate
7 method of calculation is provided for in the written lease.
8 (c) Time of reduction.--The landlord shall reduce the rental
9 payments required of each tenant commencing with the first date
10 on which the tenant is required to pay rent subsequent to the
11 effective date of the reduction or elimination of the school
12 real property tax.
13 (d) Escrow accounts.--In the event that a landlord fails to
14 reduce rental payments in the manner provided for by subsections
15 (a) and (b), the landlord shall deposit an amount equal to that
16 calculated pursuant to subsection (a) in an escrow account. Said
17 account shall be established solely in an institution whose
18 accounts are insured by a governmental agency or instrumentality
19 and shall be established on behalf of the tenant. The landlord
20 shall bear the cost of establishing and maintaining this
21 account. Within 30 days from the date on which the existing
22 lease expires, the proceeds of the account, including any
23 interest therefrom, shall be delivered to the tenant.
24 (e) Failure to reduce rent.--In the event that a landlord
25 shall fail to reduce rental payments in the manner required by
26 this section within 30 days of receipt of a written notification
27 from a tenant requesting same, said landlord shall be liable to
28 the tenant for damages in an amount equal to three times the
29 rent reduction and costs, if applicable, to which the tenant
30 would be entitled had the landlord complied with this section,
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1 provided the tenant brings an action in the court of common
2 pleas of the county wherein the property lies within 60 days of
3 said written request. No tenant shall have a lease terminated or
4 nonrenewed because of exercising a right conferred by this
5 section. Any termination or nonrenewal of a lease occurring
6 within one year of any written notification made by a tenant
7 pursuant to this subsection shall establish a rebuttable
8 presumption that said termination or nonrenewal was in
9 retaliation for the exercise of a right conferred by this
10 section if the landlord had been in noncompliance prior to the
11 receipt of said notification.
12 (f) Application of section.--This section shall be equally
13 applicable to any moneys, from whatever source derived, paid for
14 housing or other shelter.
15 Section 1110. Rebudgeting.
16 For the first year in which a school district imposes the tax
17 authorized by section 301, and it determines that the revenues
18 received from the tax are insufficient to replace projected
19 revenues lost from the elimination of other taxes, the district
20 may adjust its tax rate so as to meet its budgetary needs.
21 Nothing in this act shall be construed as allowing school
22 districts to exceed the rate limitation in that section unless
23 it complies with section 1102(b).
24 PART III
25 COUNTY TAXATION
26 CHAPTER 15
27 SALES TAX
28 Section 1501. Tax authorization.
29 (a) Rate.--For the county fiscal year 1984 and thereafter, a
30 county may impose a sales tax not in excess of 1% on the items
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1 for sale at retail taxable by the Commonwealth under Article II
2 of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
3 Reform Code of 1971. A county which elects to impose the tax
4 authorized under this section shall eliminate all per capita and
5 personal property taxes it levied pursuant to section 1770 of
6 the act of August 9, 1955 (P.L.323, No.130), known as The County
7 Code. No county shall impose, in the same year, the tax
8 authorized by section 1501 and the per capita and personal
9 property tax authorized by section 1770.
10 (b) Collection by certain vendors.--Where a sale of tangible
11 personal property or services, including any agreement therefor,
12 is made in a county other than where the tax is imposed, but
13 delivery occurs or will occur in the county where the tax
14 imposed by this section applies, a vendor will be required to
15 collect the tax from the purchaser.
16 Section 1502. Collection of tax.
17 (a) Collection, administration and enforcement.--The
18 collection, administration and enforcement of this tax shall be
19 in accordance with Article II of the act of March 4, 1971
20 (P.L.6, No.2), known as the Tax Reform Code of 1971.
21 (b) Collection agreements.--Counties may elect to enter into
22 agreements with the department for the collection of the tax
23 imposed under this section.
24 Section 1503. Use of tax receipts.
25 (a) Purposes enumerated.--The receipts generated from the
26 imposition of this tax may be used to finance any of the
27 following:
28 (1) The elimination of taxes repealed by this act.
29 (2) Mass transportation.
30 (3) A permanent improvement of the property tax
19830H0555B0623 - 21 -
1 assessment procedure existing currently in the county.
2 However, this permanent improvement shall not be construed to
3 permit only the hiring of additional employees.
4 (4) Judicial and correctional services.
5 For purposes of this section, judicial and correctional
6 services shall include, but shall not be limited to, the
7 construction and operation of correctional and detention
8 facilities, the establishment and coordination of adult and
9 juvenile programs and domestic relations programs, and the
10 reform and modernization of judicial procedures.
11 (b) Definition.--As used in this section, "mass
12 transportation" shall mean regularly scheduled transportation
13 that is available to the general public and is provided
14 according to published schedules along designated published
15 routes with specified stopping points for the taking on and
16 discharging of passengers. Mass transportation shall also
17 include shared ride public transportation services as defined in
18 the act of February 11, 1976 (P.L.14, No.10), known as the
19 Pennsylvania Rural and Intercity Common Carrier Surface
20 Transportation Assistance Act.
21 (c) Construction of section.--Nothing contained in this
22 section shall prohibit the use of revenues generated under this
23 chapter for the financing of freight lines.
24 Section 1504. Nonpreemption.
25 The authority to levy taxes under this chapter shall not be
26 preempted or otherwise invalidated by any other State tax or
27 local tax ordinance.
28 PART IV
29 (Reserved)
30 PART V
19830H0555B0623 - 22 -
1 MUNICIPAL CORPORATION TAXATION
2 CHAPTER 31
3 GENERAL PROVISIONS
4 Section 3101. Taxing powers and restrictions.
5 (a) Powers.--The duly constituted authorities of any
6 municipal corporation, may, in their discretion, by ordinance or
7 resolution, for general revenue purposes, levy, assess and
8 collect or provide for the levying, assessment and collection of
9 those taxes as they shall determine on persons, transactions,
10 privileges, subjects and personal property within the limits of
11 such municipal corporations, and upon the transfer of real
12 property, or of any interest in real property, situate within
13 the municipal corporation levying and assessing the tax,
14 regardless of where the instruments making the transfers are
15 made, executed or delivered or where the actual settlements on a
16 transfer take place. The taxing authority may provide that the
17 transferee shall remain liable for any unpaid realty transfer
18 taxes imposed by virtue of this part. Each local taxing
19 authority may, by ordinance or resolution, exempt any person
20 whose total income from all sources is less than $5,000 per
21 annum from the municipal services tax or any portion thereof,
22 and may adopt regulations for the processing of claims for
23 exemptions.
24 (b) Restrictions.--Local authorities shall not have
25 authority by virtue of this part:
26 (1) To levy, assess and collect or provide for the
27 levying, assessment and collection of any tax on the transfer
28 of real property in any of the following circumstances:
29 (i) A transfer is by will or mortgage or the
30 intestate laws of this Commonwealth.
19830H0555B0623 - 23 -
1 (ii) A transfer by the owner of previously occupied
2 residential premises to a builder of new residential
3 premises when the previously occupied residential
4 premises is taken in trade by the builder as part of the
5 consideration from the purchaser of a new previously
6 unoccupied single-family residential premises.
7 (iii) A transfer between corporations operating
8 housing projects pursuant to the act of May 20, 1949
9 (P.L.1633, No.493), known as the Housing and
10 Redevelopment Assistance Law, and the shareholders
11 thereof.
12 (iv) A transfer between nonprofit industrial
13 development agencies and industrial corporations
14 purchasing from them or on transfer to nonprofit
15 industrial development agencies.
16 (v) A transfer between husband and wife, or on a
17 transfer between persons who were previously husband and
18 wife, but who have since been divorced, provided that the
19 transfer is made within three months of the date of the
20 granting of the final decree in divorce or the decree of
21 equitable distribution of marital property, whichever is
22 later and the property or interest therein, subject to
23 the transfer, was acquired by the husband and wife, or
24 husband or wife, prior to the granting of the final
25 decree in divorce.
26 (vi) A transfer between parent and child, or the
27 spouse of that child, or between parent and trustee for
28 the benefit of a child or the spouse of that child.
29 (vii) A transfer by and between a principal and
30 straw party for the purpose of placing a mortgage or
19830H0555B0623 - 24 -
1 ground rent upon the premises.
2 (viii) A correctional deed without consideration.
3 (ix) A transfer to the United States, the
4 Commonwealth of Pennsylvania, or to any of their
5 instrumentalities, agencies or municipal corporations by
6 gift, dedication or deed in lieu of condemnation, or deed
7 of confirmation in connection with condemnation
8 proceedings, or reconveyance by the condemning body of
9 the property condemned to the owner of record at the time
10 of condemnation which reconveyance may include property
11 line adjustments, provided said reconveyance is made
12 within one year from the date of condemnation.
13 (x) A lease.
14 (xi) A conveyance to a trustee under a recorded
15 trust agreement for the express purpose of holding title
16 in trust as security for a debt contracted at the time of
17 the conveyance under which the trustee is not the lender
18 and requiring the trustee to make reconveyance to the
19 grantor-borrower upon the repayment of the debt.
20 (xii) Any sheriff sale instituted by a mortgagee in
21 which the purchaser is the mortgagee who instituted the
22 sale.
23 (2) To levy, assess or collect a tax on the gross
24 receipts from utility service of any person or company whose
25 rates and services are fixed and regulated by the
26 Pennsylvania Public Utility Commission or on any public
27 utility services rendered by any person or company or on any
28 privilege or transaction involving the rendering of any
29 public utility service.
30 (3) Except on sales of admission to places of amusement
19830H0555B0623 - 25 -
1 or on sales or other transfers of title or possession of
2 property, to levy, assess or collect a tax on the privilege
3 of employing such tangible property as is now or does
4 hereafter become subject to a State tax. For the purposes of
5 this paragraph, real property rented for camping purposes
6 shall not be considered a place of amusement.
7 (4) To levy, assess and collect a tax on goods and
8 articles manufactured within a municipal corporation or on
9 the byproducts of manufacture, or on minerals, timber,
10 natural resources and farm products produced within a
11 municipal corporation or on the preparation or processing
12 thereof for use or market, or on any privilege, act or
13 transaction related to the business of manufacturing, the
14 production, preparation or processing of minerals, timber and
15 natural resources, or farm products, by manufacturers, by
16 producers and by farmers with respect to the goods, articles
17 and products of their own manufacture, production or growth,
18 or on any privilege, act or transaction relating to the
19 business of processing byproducts of manufacture, or on the
20 transportation, loading, unloading or dumping or storage of
21 goods, articles, products or byproducts; except that local
22 authorities may levy, assess and collect taxes on the income
23 or for municipal services of natural persons engaged in the
24 above activities whether doing business as individual
25 proprietorship or as members of partnerships or other
26 associations, provided that for the purpose of this part
27 "manufacturing" shall include, but not be limited to,
28 processing as that term is defined in section 602 of the act
29 of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code
30 of 1971.
19830H0555B0623 - 26 -
1 (5) To levy, assess or collect a tax on personal
2 property subject to taxation by counties or on personal
3 property owned by persons, associations and corporations
4 specifically exempted by law from taxation under the county
5 personal property tax law.
6 (6) To levy, assess or collect a tax on membership in or
7 membership dues, fees or assessment of charitable, religious,
8 beneficial or nonprofit organizations including, but not
9 limited to, sportsmen's, recreational, golf and tennis clubs,
10 girl and boy scout troops and councils.
11 (7) To levy, assess or collect any tax on a mobilehome
12 or house trailer subject to a real property tax unless the
13 same tax is levied, assessed and collected on other real
14 property in the municipal corporation.
15 (8) (i) To levy, assess or collect any tax on
16 individuals for the privilege of engaging in an
17 occupation except that a municipal services tax may be
18 levied, assessed and collected, but only by the municipal
19 corporation of the taxpayer's place of employment.
20 (ii) Payment of any municipal services tax to any
21 municipal corporation by any person pursuant to an
22 ordinance or resolution passed or adopted under the
23 authority of this part shall be limited to a flat rate of
24 $25 on each person for each calendar year.
25 (iii) The situs of the municipal services tax shall
26 be the place of employment, which shall be determined as
27 of the day the taxpayer first becomes subject to the tax
28 during the calendar year, and, in the event a person is
29 engaged in more than one occupation, or an occupation
30 which requires his working in more than one municipal
19830H0555B0623 - 27 -
1 corporation during the calendar year, the priority of
2 claim to collect the municipal services tax shall be in
3 the following order:
4 (A) The municipal corporation in which a person
5 maintains his principal office or is principally
6 employed.
7 (B) The municipal corporation in which the
8 person resides and works, if the tax is levied by
9 that municipal corporation.
10 (C) The municipal corporation in which a person
11 is employed and which imposes the tax nearest in
12 miles to the person's home.
13 (iv) It is the intent of this provision that no
14 person shall pay more than $25 in any calendar year as a
15 municipal services tax irrespective of the number of
16 municipal corporations within which that person may be
17 employed within any given calendar year.
18 (v) In case of dispute, a tax receipt of the taxing
19 authority for that calendar year declaring that the
20 taxpayer has made prior payment shall constitute prima
21 facie certification of payment to all other municipal
22 corporations.
23 (9) To levy, assess or collect a tax on admissions to
24 motion picture theaters.
25 (10) To levy, assess or collect any tax on occupations
26 using a millage or percentage of any value, a flat rate or
27 any arbitrary value placed on various occupations.
28 (11) To levy, assess or collect any per capita or
29 similar head tax.
30 (12) To levy, assess or collect a tax on new residential
19830H0555B0623 - 28 -
1 construction.
2 (13) To levy, assess or collect a tax on any privilege,
3 transaction, subject, occupation or personal which is now or
4 hereafter becomes subject to a State tax or license fee.
5 (14) To levy, assess or collect a tax on the privilege
6 of doing business in the municipal corporation.
7 Section 3102. Vacation of tax ordinances and resolutions by
8 State tax measures.
9 If, subsequent to the passage of any ordinance or resolution
10 under the authority of this part, the General Assembly shall
11 impose a tax or license fee on any privilege, transaction,
12 subject or occupation, or on personal property or on sales of
13 admission to places of amusement or on sales or other transfer
14 of title or possession of property taxed by any municipal
15 corporation hereunder, the statute imposing the State tax or
16 license fee thereon shall automatically vacate the ordinance or
17 resolution passed under the authority of this part as to all
18 taxes accruing subsequent to the end of the current fiscal year
19 of that municipal corporation. It is the intention of this
20 section to confer upon municipal corporations the power to levy,
21 assess and collect taxes upon any and all subjects of taxation,
22 except as above restricted and limited, which the Commonwealth
23 has power to tax, but which it does not tax or license, subject
24 only to the foregoing provision that any tax or license shall
25 automatically terminate at the end of the current fiscal year of
26 the municipal corporation. Nothing in this section, however,
27 shall prohibit a municipal corporation from levying and
28 collecting the income tax authorized by this part.
29 Section 3103. Appeals by taxpayers.
30 (a) Time of taking appeal.--No tax levied for the first time
19830H0555B0623 - 29 -
1 by any municipal corporation to which this part applies shall go
2 into effect until 30 days from the time of the adoption of the
3 ordinance or resolution levying the tax. Within said 30 days,
4 taxpayers representing 25% or more of the total valuation of
5 real estate in the municipal corporation as assessed for
6 taxation purposes or taxpayers of the municipal corporation not
7 less than 25 in number aggrieved by the ordinance or resolution
8 shall have the right to appeal therefrom to the court of common
9 pleas of the county upon giving bond with sufficient security in
10 the amount of $2,500, approved by the court, to prosecute the
11 appeal with effect and for the payment of costs. The petition
12 shall set forth the objections to the tax and the facts in
13 support of those objections and shall be accompanied by the
14 affidavit of at least five of the petitioners that the averments
15 of the petition are true and the petition is not filed for the
16 purpose of delay.
17 (b) Supersedeas.--No appeal shall act as a supersedeas
18 unless specifically allowed by the court to which the appeal is
19 taken or a judge thereof.
20 (c) Service of petition.--Immediately upon the filing of any
21 petition, the petitioners shall serve a copy of the petition and
22 any rule granted by the court upon the president, chairman,
23 secretary or clerk of the legislative body levying the tax.
24 (d) Hearing.--The court shall fix a day for a hearing not
25 less than 15 days nor more than 30 days after the filing of the
26 petition. Notice of the time of the hearing shall be given to
27 all interested parties as the court shall direct. The court
28 shall promptly hear and dispose of the appeal.
29 (e) Court order.--It shall be the duty of the court to
30 declare the ordinance and the tax imposed thereby to be valid
19830H0555B0623 - 30 -
1 unless it concludes that the ordinance is unlawful or finds that
2 the tax imposed is excessive or unreasonable, but the court
3 shall not interfere with the reasonable discretion of the
4 legislative body in selecting the subjects or fixing the rates
5 of the tax. The court may declare invalid all or any portion of
6 the ordinance or of the tax imposed or may reduce the rates of
7 tax.
8 Section 3104. Limitations on rates of specific taxes.
9 (a) Rate schedule.--No taxes levied under this part shall be
10 levied by any municipal corporation on the following subjects
11 exceeding the rates specified in this section:
12 (1) On each dollar of the net volume of business
13 transacted by wholesale dealers in goods, wares and
14 merchandise, one mill, by retail dealers in goods, wares and
15 merchandise and by proprietors of restaurants or other places
16 where food, drink and refreshments are served, one and one-
17 half mills except in cities of the second class, where rates
18 shall not exceed one and one-quarter mills on wholesale
19 dealers, retail dealers and proprietors. For purposes of this
20 section "net volume of business" shall mean gross receipts
21 less the following deductions:
22 (i) Cost of goods sold.
23 (ii) Cost of labor.
24 (iii) Cost of housing or rent, including, but not
25 limited to, depreciation claimed for Pennsylvania income
26 tax purposes.
27 No tax shall be levied on the dollar volume of business
28 transacted by wholesale and retail dealers derived from the
29 resale of goods, wares and merchandise, taken by any dealer
30 as a trade-in or as part payment for other goods, wares and
19830H0555B0623 - 31 -
1 merchandise, except to the extent that the resale price
2 exceeds the trade-in allowance.
3 (2) On income of individuals, not to exceed 0.75%:
4 (i) For municipal fiscal years beginning in 1983 and
5 thereafter, a municipal corporation may impose a tax on
6 the personal income of residents of up to 0.75%
7 consistent with the provisions of Article III of the act
8 of March 4, 1971 (P.L.6, No.2), known as the Tax Reform
9 Code of 1971. A municipal corporation may levy the tax
10 provided for under this section, but only at a rate that
11 will provide revenue substantially equal to the total of
12 revenues lost through elimination of the taxes authorized
13 by this part.
14 (ii) A municipal corporation may impose an
15 additional percentage of tax on the personal income of
16 residents, provided that there is a reduction in real
17 property tax rates or assessment values sufficient to
18 reduce real property tax revenues by an amount
19 substantially equal to the revenue raised by the
20 additional income tax. The combined rate of tax
21 authorized by this section and the tax authorized by
22 subparagraph (i), shall not exceed 0.75%.
23 (3) On the transfer of real property, 0.5%.
24 (4) On admissions to places of amusement, athletic
25 events and the like, but not on motion picture theaters, 5%.
26 (5) Municipal services charge, not to exceed $25 per
27 person.
28 (b) Savings provision.--If the municipal corporation levies
29 and collects a tax in its fiscal year 1983 that exceeds the rate
30 provided for in this section, the municipal corporation may
19830H0555B0623 - 32 -
1 continue to levy and collect the tax at the rate imposed as of
2 its fiscal year 1983.
3 Section 3105. Required rent reductions.
4 (a) Notice.--Within 30 days after receipt of his real
5 property tax bill, a landlord shall disclose in writing to each
6 tenant who has occupied a rental unit for more than 45 days, the
7 reduction in real property taxes, if any, under this chapter
8 which is attributable to that tenant's unit. The amount of tax
9 reduction attributable to each unit shall be based upon
10 allocated square footage occupied or other reasonable criteria.
11 The rental amount specified in any lease shall reflect any
12 reduction in real property taxes pursuant to this chapter.
13 (b) Amount of reduction.--Each landlord shall reduce rental
14 payments required of each residential tenant in an amount equal
15 to any reduction or elimination of the municipal corporation
16 property tax which is allocable to real estate leased by said
17 tenant. The rental reduction shall be calculated by dividing the
18 total real property tax reduction or elimination applicable to
19 said real property during the course of the initial tax year by
20 the number of rental payments required of the tenant during said
21 tax year unless an alternate method of calculation is provided
22 for in the written lease. In cases where more than one rental
23 unit is situated upon any tract of real estate affected by said
24 tax reduction or elimination, the landlord shall reduce the rent
25 of each tenant in a proportion equal to the total amount of rent
26 that the rental unit leased by the tenant bears to the total
27 amount of rent of all rental units situated upon said tract of
28 real estate unless an alternate method of calculation is
29 provided for in the written lease.
30 (c) Time of reduction.--The landlord shall reduce the rental
19830H0555B0623 - 33 -
1 payments required of each tenant commencing with the first date
2 on which the tenant is required to pay rent subsequent to the
3 effective date of the reduction or elimination of the municipal
4 corporation real property tax.
5 (d) Escrow account.--In the event that a landlord shall fail
6 to reduce rental payments provided for in subsections (a), (b)
7 and (c), said landlord shall deposit an amount equal to that
8 calculated pursuant to subsections (a) and (b) in an escrow
9 account. This account shall be established solely in an
10 institution whose accounts are insured by a governmental agency
11 or instrumentality and shall be established on behalf of the
12 tenant. The landlord shall bear the cost of establishing and
13 maintaining this account. Within 30 days from the date on which
14 the existing lease expires, the proceeds of the account,
15 including any interest therefrom, shall be delivered to the
16 tenant.
17 (e) Failure to reduce rent.--In the event that a landlord
18 shall fail to reduce rental payments in the manner required by
19 this section within 30 days of receipt of a written notification
20 from a tenant requesting same, said landlord shall be liable to
21 the tenant for damages in an amount equal to three times the
22 rent reduction and costs, if applicable, to which the tenant
23 would be entitled had the landlord complied with this section,
24 provided the tenant brings an action in the court of common
25 pleas of the county wherein the property lies within 60 days of
26 said written request. No tenant shall have a lease terminated or
27 nonrenewed because of exercising a right conferred by this
28 section. Any termination or nonrenewal of a lease occurring
29 within one year of any written notification made by a tenant
30 pursuant to this subsection, shall establish a rebuttable
19830H0555B0623 - 34 -
1 presumption that said termination or nonrenewal was in
2 retaliation for the exercise of a right conferred by this
3 section if the landlord had been in noncompliance prior to the
4 receipt of said notification.
5 (f) Applicability of section.--This section shall be equally
6 applicable to any moneys, from whatever source derived, paid for
7 housing or other shelter.
8 Section 3106. Register for income tax and municipal services
9 charges.
10 (a) Contents of register.--It shall be the duty of the
11 Department of Community Affairs to have available an official
12 continuing register supplemented annually of all income tax and
13 municipal services charges levied under authority of this part.
14 The register and its supplements, hereinafter referred to as the
15 register, shall list those jurisdictions levying income or
16 municipal services taxes, the rate of the tax as stated in the
17 tax levying ordinance or resolution, the name and address of the
18 officer responsible for administering the collection of the tax
19 and from whom information, forms for reporting and copies of
20 rules and regulations are available. The register shall also
21 contain the foregoing information for the personal income tax
22 and any other tax authorized by this part.
23 (b) Submission of register information to Department of
24 Community Affairs.--Information for the register shall be
25 furnished by the secretary of each taxing body to the Department
26 of Community Affairs in the manner and on the forms as the
27 Department of Community Affairs may prescribe. The information
28 must be received by the Department of Community Affairs by
29 certified mail not later than May 31 of each year to show new
30 tax enactments, repeals and changes. Failure to comply with this
19830H0555B0623 - 35 -
1 date for filing may result in the omission of the levy from the
2 register for that year. Failure of the Department of Community
3 Affairs to receive information of taxes continued without change
4 may be construed by the department to mean that the information
5 contained in the previous register remains in force.
6 (c) Availability.--The Department of Community Affairs shall
7 have the register with annual supplements as may be required by
8 new tax enactments, repeals or changes available upon request
9 not later than July 1 of each year. The effective period for
10 each register shall be from July 1 of the year in which it is
11 issued to June 30 of the following year.
12 (d) Effect of register.--Employers shall not be required by
13 any local ordinance to withhold from the compensation of their
14 employees any tax imposed under this part, which is not listed
15 in the register, or make reports of compensation in connection
16 with taxes not so listed. If the register is not, however,
17 available by July 1, the register of the previous year shall
18 continue temporarily in effect for an additional period not to
19 exceed one year. This section shall not affect the liability of
20 any taxpayer for taxes lawfully imposed under this part.
21 (e) Withholding.--Ordinances or resolutions imposing income
22 or municipal services taxes under authority of this part may
23 contain provisions requiring employers doing business within the
24 jurisdiction of the political subdivision imposing the tax to
25 withhold the tax from the compensation of those of their
26 employees who are subject to the tax. No employer shall,
27 however, be held liable for failure to withhold income taxes or
28 for the payment of withheld tax money to a political subdivision
29 other than the political subdivision entitled to receive that
30 money if the failure to withhold or the incorrect transmittal of
19830H0555B0623 - 36 -
1 withheld taxes arises from incorrect information as to the
2 employee's place of residence submitted by the employee.
3 Employers shall not be required by any local ordinance to
4 withhold from compensation for any one of their employees for
5 the municipal services tax more than one time in any fiscal
6 period. Notwithstanding this section, the municipal services tax
7 shall be applicable to employment in the period beginning
8 January 1 of the current year and ending December 31 of the
9 current year, except that taxes imposed for the first time shall
10 become effective from the date specified in the ordinance or
11 resolution and the tax shall continue in force on a calendar
12 year basis.
13 Section 3107. Collection of taxes.
14 Whenever a school district shall levy, assess and collect or
15 provide for the levying, assessment and collection of a tax upon
16 income, as provided for in Chapter 3, that school district and
17 all municipal corporations within its geographical limits which
18 levy, assess and collect or provide for the levying, assessment
19 and collection of a tax upon income, may select one person or
20 agency to collect the taxes upon income imposed by all of the
21 political subdivisions. In selecting that person or agency, each
22 political subdivision shall share in the selection upon a basis
23 agreed upon by each political subdivision, or in the absence of
24 any agreement on the basis of voting according to the proportion
25 that the population of each bears to the entire population of
26 the combined collection district, according to the latest
27 official Federal census, and the majority of the votes cast
28 shall determine the person or agency selected to collect the
29 taxes. The provisions of this section shall not prohibit school
30 districts and other political subdivisions which levy, assess
19830H0555B0623 - 37 -
1 and collect or provide for the levying, assessment and
2 collection of taxes upon income, from selecting the same person
3 or agency to collect the tax upon income in an area larger than
4 the geographical limits of a school district or municipal
5 corporation.
6 Section 3108. Cooperation by Department of Revenue with
7 municipal corporations.
8 Municipal corporations may elect to enter into agreements
9 with the department for the collection of taxes imposed under
10 this part.
11 Section 3109. Audits of income taxes.
12 Except in cities of the second class, the governing body of
13 each municipal corporation which levies, assesses and collects
14 or provides for the levying, assessment and collection of a tax
15 upon income, shall provide for not less than one examination
16 each year of the books, accounts and records of the income tax
17 collector, by a certified public accountant, a firm of certified
18 public accountants, a competent independent public accountant or
19 a firm of independent public accountants appointed by the
20 governing body. Whenever one person or agency is selected to
21 collect income taxes for more than one political subdivision,
22 the books, accounts and records of that person or agency shall
23 be examined as provided above in the case of a tax collector for
24 each political subdivision, except that the accountant shall be
25 selected in the manner provided for selection of one person or
26 agency to collect income taxes for the school district and the
27 cities, boroughs, towns and townships within the geographical
28 limits of that school district. The reports of the audit shall
29 be sent to the governing body or bodies of the political
30 subdivision or political subdivisions employing the accountant.
19830H0555B0623 - 38 -
1 No further or additional audits shall be performed by elected or
2 appointed auditors.
3 Section 3110. Audits of taxes other than income taxes.
4 The books, accounts and records of persons collecting taxes
5 pursuant to this part, other than taxes levied, assessed and
6 collected upon income, shall be audited, adjusted and settled in
7 the manner prescribed by law for the auditing, adjusting and
8 settling of accounts of persons receiving or expending funds of
9 the political subdivision which has levied, assessed and
10 collected the taxes pursuant to this part, other than taxes
11 levied, assessed and collected upon income.
12 Section 3111. Rebudgeting.
13 For the first year in which a municipal corporation imposes
14 the tax authorized by section 3104(2), and it determines that
15 the revenues received from the tax are insufficient to replace
16 projected revenues lost from the elimination of other taxes, the
17 district may adjust its tax rate so as to meet its budgetary
18 needs. Nothing in this section shall be construed as allowing
19 municipal corporations to exceed the rate limitation in that
20 section unless it complies with section 3501.
21 CHAPTER 33
22 INCOME TAXES
23 Section 3301. Definitions and construction.
24 (a) Definitions.--The following words and phrases when used
25 in this chapter shall have the meanings given to them in this
26 subsection unless the context clearly indicates otherwise:
27 "Association." A partnership, limited partnership or any
28 other unincorporated group of two or more persons.
29 "Business." An enterprise, activity, profession or any other
30 undertaking of an unincorporated nature conducted for profit or
19830H0555B0623 - 39 -
1 ordinarily conducted for profit whether by a person,
2 partnership, association or any other entity.
3 "Corporation." A corporation or joint stock association
4 organized under the laws of the United States, the Commonwealth
5 of Pennsylvania, or any other state, territory, foreign country
6 or dependency.
7 "Current year." The calendar year for which the tax is
8 levied.
9 "Domicile." The place where one lives and has his permanent
10 home and to which he has the intention of returning whenever he
11 is absent. Actual residence is not necessarily domicile, for
12 domicile is the fixed place of abode which, in the intention of
13 the taxpayer, is permanent rather than transitory. Domicile is
14 the voluntarily fixed place of habitation of a person, not for a
15 mere special or limited purpose, but with the present intention
16 of making a permanent home, until some event occurs to induce
17 him to adopt some other permanent home. In the case of
18 businesses or associations, the domicile is that place
19 considered as the center of business affairs and the place where
20 its functions are discharged.
21 "Employer." A person, partnership, association, corporation,
22 institution, governmental body or unit or agency, or any other
23 entity employing one or more persons for compensation.
24 "Income." Personal income as defined in this section.
25 "Income tax officer" or "officer." The person, public
26 employee or private agency designated by a governing body to
27 collect and administer the tax on income.
28 "Nonresident." A person, partnership, association or other
29 entity domiciled outside the taxing district.
30 "Person" or "individual." A natural person.
19830H0555B0623 - 40 -
1 "Personal income." The classes of income defined in section
2 303(a)(1) through (8) of the act of March 4, 1971 (P.L.6, No.2),
3 known as the Tax Reform Code of 1971.
4 "Preceding year." The calendar year before the current year.
5 "Resident." A person, partnership, association or other
6 entity domiciled in the taxing district.
7 "Succeeding year." The calendar year following the current
8 year.
9 "Taxpayer." A person, partnership, association or any other
10 entity, required hereunder to file a return of income or to pay
11 a tax thereon.
12 (b) Construction of chapter.--The provisions of this chapter
13 shall be included in or construed to be a part of any ordinances
14 enacted for the purpose of levying a tax on personal income of
15 residents and nonresidents respectively and shall not be altered
16 or changed by the levying municipal corporation.
17 Section 3302. Tax year.
18 The taxes levied under this chapter shall be applicable to
19 personal income received by residents in the period beginning
20 January 1 of the current year and ending December 31 of the
21 current year or for taxpayer fiscal years beginning in the
22 current year, except that taxes imposed for the first time shall
23 become effective from the date specified in the ordinance or
24 resolution and the tax shall continue in force on a calendar
25 year or taxpayer fiscal year basis, without annual reenactment,
26 unless the rate of the tax is subsequently changed. Changes in
27 rate shall become effective on the date specified in the
28 ordinance.
29 Section 3303. Payment of taxes.
30 (a) Procedure.--Every taxpayer receiving income other than
19830H0555B0623 - 41 -
1 compensation upon which tax has been withheld by his employer
2 shall, as the governing body elects:
3 (1) Pay to the officer an annual payment of tax due on
4 or before April 15 of the succeeding year for the period
5 beginning January 1 and ending December 31 of the current
6 year.
7 (2) On or before April 15 of the current year make and
8 file with the officer on a form prescribed or approved by the
9 officer, a declaration of his estimated income during the
10 period beginning January 1 and ending December 31 of the
11 current year and pay to the officer in four equal quarterly
12 installments the tax due thereon as follows: the first
13 installment at the time of filing the declaration and the
14 other installments on or before June 15 of the current year,
15 September 15 of the current year and January 15 of the
16 succeeding year, respectively.
17 (b) Quarterly payments.--Where the governing body elects to
18 require the filing of a declaration and quarterly payments, any
19 taxpayer who first anticipates any income after April 15 of the
20 current year shall make and file the declaration hereinabove
21 required on or before June 15 of the current year, September 15
22 of the current year or December 31 of the current year,
23 whichever of these dates next follows the date on which the
24 taxpayer first anticipates the income and pay to the officer in
25 equal installments the tax due thereon on or before the
26 quarterly payment dates which remain after the filing of the
27 declaration.
28 (c) Estimated income.--Where the governing body requires a
29 declaration of estimated income and quarterly payments of tax
30 due on income, every taxpayer shall, on or before April 15 of
19830H0555B0623 - 42 -
1 the succeeding year, make and file with the officer on a form
2 prescribed or approved by the officer a final return showing the
3 amount of income received during the period beginning January 1
4 of the current year and ending December 31 of the current year,
5 the total amount of tax due thereon and the total amount of tax
6 paid thereon. At the time of filing the final return, the
7 taxpayer shall pay to the officer the balance of tax due or
8 shall make demand for refund or credit in the case of
9 overpayment.
10 (d) Final return.--Any taxpayer may, in lieu of paying the
11 fourth quarterly installment of his estimated tax, elect to make
12 and file with the officer on or before January 31 of the
13 succeeding year, the final return as hereinabove required.
14 (e) Adjusted declaration.--The officer may be authorized to
15 provide by regulation for the making and filing of adjusted
16 declarations of estimated income and for the payments of the
17 estimated tax in cases where a taxpayer who has filed the
18 declaration hereinabove required anticipates additional income
19 not previously declared or finds that he has overestimated his
20 anticipated income.
21 (f) Final return upon discontinuance of business.--Every
22 taxpayer who discontinues business prior to December 31 of the
23 current year, shall, within 30 days after the discontinuance of
24 business, file his final return as hereinabove required and pay
25 the tax due.
26 Section 3304. Final return and payment of balance due.
27 At the election of the governing body every taxpayer shall,
28 on or before April 15 of the succeeding year, make and file with
29 the officer on a form prescribed or approved by the officer a
30 final return showing the amount of income received during the
19830H0555B0623 - 43 -
1 period beginning January 1 of the current year and ending
2 December 31 of the current year, the total amount of tax due
3 thereon, the amount of tax paid thereon, the amount of tax
4 thereon that has been withheld pursuant to the provisions
5 relating to the collection at source and the balance of tax due.
6 At the time of filing the final return, the taxpayer shall pay
7 the balance of the tax due or shall make demand for refund or
8 credit in the case of overpayment.
9 Section 3305. Income not subject to withholding.
10 Every taxpayer who is employed for compensation and who
11 received any income not subject to the provisions relating to
12 collection at source, shall as the governing body elects:
13 (1) Make and file with the officer on a form prescribed
14 or approved by the officer, an annual return setting forth
15 the aggregate amount of income not subject to withholding
16 from him during the period beginning January 1 and ending
17 December 31 of the current year and other information as the
18 officer may require and pay to the officer the amount of tax
19 shown as due thereon on or before April 15 of the succeeding
20 year.
21 (2) Make and file with the officer on a form prescribed
22 or approved by the officer, a quarterly return on or before
23 April 30 of the current year, July 31 of the current year,
24 October 31 of the current year and January 31 of the
25 succeeding year, setting forth the aggregate amount of income
26 not subject to withholding by him during the three-month
27 periods ending March 31 of the current year, June 30 of the
28 current year, September 30 of the current year and December
29 31 of the current year, respectively, and subject to the tax,
30 together with such other information as the officer may
19830H0555B0623 - 44 -
1 require. Every taxpayer making a return shall, at the time of
2 filing thereof, pay to the officer the amount of tax shown as
3 due thereon.
4 Section 3306. Employers.
5 (a) Registration.--Every employer having an office, factory,
6 workshop, branch, warehouse or other place of business within
7 the taxing jurisdiction imposing a tax on income within the
8 taxing district who employs one or more persons, other than
9 domestic servants, for compensation, who has not previously
10 registered, shall, within 15 days after becoming an employer,
11 register with the officer his name and address and such other
12 information as the officer may require.
13 (b) Deduction of tax from compensation.--Every employer
14 having an office, factory, workshop, branch, warehouse or other
15 place of business within the taxing jurisdiction imposing a tax
16 on income who employs one or more persons, other than domestic
17 servants, for compensation, shall deduct at the time of payment
18 thereof, the tax imposed by ordinance or resolution on the
19 income due to his employee or employees.
20 (c) Notice.--Upon written notification by the municipal
21 corporation of the rate of income tax imposed by the municipal
22 corporation, an employer who employs one or more persons, other
23 than domestic servants, for compensation shall deduct at the
24 time of payment, the tax imposed by ordinance or resolution on
25 the income due to the employee or employees.
26 (d) Returns.--The employer shall, on or before April 30 of
27 the current year, July 31 of the current year, October 31 of the
28 current year and January 31 of the succeeding year, file a
29 return and pay to the officer the amount of taxes deducted
30 during the preceding three-month periods ending March 31 of the
19830H0555B0623 - 45 -
1 current year, June 30 of the current year, September 30 of the
2 current year and December 31 of the current year, respectively.
3 The return, unless otherwise agreed upon between the officer and
4 employer, shall show the name and social security number of each
5 employee, the income of each employee during the preceding
6 three-month period, the tax deducted therefrom, the political
7 subdivisions imposing the tax upon the employee, the total
8 income of all employees during the preceding three-month period
9 and the total tax deducted therefrom and paid with the return.
10 (e) Monthly payments.--Any employer who for two of the
11 preceding four quarterly periods has failed to deduct the proper
12 tax, or any part thereof, or has failed to pay over the proper
13 amount of tax to the taxing authority, may be required by the
14 officer to file his return and pay the tax monthly. In such
15 cases, payments of tax shall be made to the officer on or before
16 the last day of the month succeeding the month for which the tax
17 was withheld.
18 Section 3307. Returns and withholding statements.
19 (a) General rule.--On or before February 28 of the
20 succeeding year, every employer shall file with the officer:
21 (1) An annual return showing the total amount of income
22 paid, the total amount of tax deducted and the total amount
23 of tax paid to the officer for the period beginning January 1
24 of the current year and ending December 31 of the current
25 year.
26 (2) A return withholding statement for each employee
27 employed during all or any part of the period beginning
28 January 1 of the current year and ending December 31 of the
29 current year, setting forth all of the following:
30 (i) the employee's name, address and social security
19830H0555B0623 - 46 -
1 number;
2 (ii) the amount of income paid to the employee
3 during said period;
4 (iii) the amount of tax deducted;
5 (iv) the political subdivisions imposing the tax
6 upon the employee; and
7 (v) the amount of tax paid to the officer.
8 Every employer shall furnish two copies of the individual
9 return to the employee for whom it is filed.
10 (b) Discontinuance of licenses.--Every employer who
11 discontinues business prior to December 31 of the current year,
12 shall, within 30 days after the discontinuance of business, file
13 the returns and withholding statements hereinabove required and
14 pay the tax due.
15 Section 3308. Liability.
16 Except as otherwise provided in section 3309, every employer
17 who willfully or negligently fails or omits to make the
18 deductions required by this chapter shall be liable for payment
19 of the taxes which he was required to withhold to the extent
20 that those taxes have not been recovered from the employee.
21 Section 3309. Filing of return.
22 The failure or omission of any employer to make the
23 deductions required by this chapter shall not relieve any
24 employee from the payment of the tax or from complying with the
25 requirements of the ordinance or resolution relating to the
26 filing of declarations and returns.
27 Section 3310. Powers and duties of tax collection officer.
28 (a) Collection and records.--It shall be the duty of the
29 officer to collect and receive the taxes, fines and penalties
30 imposed by the ordinance or resolution. It shall also be his
19830H0555B0623 - 47 -
1 duty to keep a record showing the amount received by him from
2 each person or business paying the tax and the date of the
3 receipt.
4 (b) Bond.--
5 (1) Each officer, before entering upon his official
6 duties shall give and acknowledge a bond to the political
7 subdivision or political subdivisions appointing him. If the
8 political subdivision or political subdivisions shall by
9 resolution designate any bond previously given by the officer
10 as adequate, that bond shall be sufficient to satisfy the
11 requirements of the subsection.
12 (2) Each bond shall be joint and several, with one or
13 more corporate sureties which shall be surety companies
14 authorized to do business in this Commonwealth and duly
15 licensed by the Insurance Commissioner of this Commonwealth.
16 (3) Each bond shall be conditioned upon the faithful
17 discharge by the officer, his clerks, assistants and
18 appointees of all trusts confided in him by virtue of his
19 office, upon the faithful execution of all duties required of
20 him by virtue of his office, upon the just and faithful
21 accounting or payment over, according to law, of all moneys
22 and all balances thereof paid to, received or held by him by
23 virtue of his office and upon the delivery to his successor
24 or successors in office of all books, papers, documents or
25 other official things held in right of his office.
26 (4) Each bond shall be taken in the name of the
27 appointing authority or authorities, and shall be for the use
28 of the political subdivision or political subdivisions
29 appointing the officer, and for the use of such other person
30 or persons for whom money shall be collected or received, or
19830H0555B0623 - 48 -
1 as his or her interest shall otherwise appear, in case of a
2 breach of any of the conditions thereof by the acts or
3 neglect of the principal on the bond.
4 (5) The political subdivision or political subdivisions
5 appointing the officer or any person may sue upon the said
6 bond in its or his own name for its or his own use.
7 (6) Each bond shall contain the name or names of the
8 surety company or companies bound thereon. The political
9 subdivision or political subdivisions appointing the officer
10 shall fix the amount of the bond at an amount equal to the
11 maximum amount of taxes which may be in the possession of the
12 officer at any given time.
13 (7) The political subdivision or political subdivisions
14 appointing the officer may, at any time, upon cause shown and
15 due notice to the officer and his surety or sureties, require
16 or allow the substitution or the addition of a surety company
17 acceptable to the political subdivision or political
18 subdivisions for the purpose of making the bond sufficient in
19 amount, without releasing the surety or sureties first
20 approved from any accrued liability or previous action on the
21 bond.
22 (8) The political subdivision or political subdivisions
23 appointing the officer shall designate the custodian of the
24 bond required to be given by the officer.
25 (c) General duties enumerated.--The officer charged with the
26 administration and enforcement of the provisions of the
27 ordinance or resolution is hereby empowered to prescribe, adopt,
28 promulgate and enforce, rules and regulations relating to any
29 matter pertaining to the administration and enforcement of the
30 ordinance or resolution, including provisions for the re-
19830H0555B0623 - 49 -
1 examination and correction of declarations and returns, and of
2 payments alleged or found to be incorrect, or as to which an
3 overpayment is claimed or found to have occurred, and to make
4 refunds in case of overpayment, for any period of time not to
5 exceed six years subsequent to the date of payment of the sum
6 involved and to prescribe forms necessary for the administration
7 of the ordinance or resolution. No rule or regulation of any
8 kind shall be enforceable unless it has been approved by
9 resolution by the governing body. A copy of the rules and
10 regulations currently in force shall be available for public
11 inspection.
12 (d) Refunds.--The officer shall refund, on petition of, and
13 proof by the taxpayer, income tax paid on the taxpayer's
14 ordinary and necessary business expenses, to the extent that
15 those expenses are not paid by the taxpayer's employer.
16 (e) Examination of books, papers and records.--The officer
17 and agents designated by him are hereby authorized to examine
18 the books, papers and records of any employer or of any taxpayer
19 or of any person whom the officer reasonably believes to be an
20 employer or taxpayer, in order to verify the accuracy of any
21 declaration or return, or if no declaration or return was filed,
22 to ascertain the tax due. Every employer and every taxpayer and
23 every person whom the officer reasonably believes to be an
24 employer or taxpayer, is hereby directed and required to give to
25 the officer, or to any agent designated by him, the means,
26 facilities and opportunity for the examination and
27 investigations, as are hereby authorized.
28 (f) Confidential information.--Any information gained by the
29 officer, his agents or by any other official or agent of the
30 taxing district, as a result of any declarations, returns,
19830H0555B0623 - 50 -
1 investigations, hearings or verifications required or authorized
2 by the ordinance or resolution, shall be confidential, except
3 for official purposes and except in accordance with a proper
4 judicial order, or as otherwise provided by law.
5 (g) Establishment of filing and reporting dates.--The
6 officer is authorized to establish different filing, reporting
7 and payment dates for taxpayers whose fiscal years do not
8 coincide with the calendar year.
9 (h) Distribution of tax receipts.--The officer shall, at
10 least quarterly, distribute income taxes to the appropriate
11 political subdivisions. The political subdivisions shall not be
12 required to request the officer to distribute the funds
13 collected, but shall at least annually reconcile their receipts
14 with the records of the officer and return to or credit the
15 officer with any overpayment. If the officer, within one year
16 after receiving a tax payment, cannot identify the taxing
17 jurisdiction entitled to a tax payment, he shall make payment to
18 the municipality in which the tax was collected.
19 (i) Compensation and expenses.--The income tax officer shall
20 receive compensation for his services and expenses as determined
21 by the governing body. In the case of a single collector
22 established under this act, the taxing jurisdictions shall share
23 in the compensation and expenses of a single officer according
24 to the proportionate share that the total annual collections for
25 each jurisdiction bears to the total annual collection for all
26 political subdivisions in a single collector district, except
27 that with the agreement of two-thirds of all participating
28 political subdivisions, a different manner of sharing may be
29 substituted.
30 Section 3311. Suit for collection of tax.
19830H0555B0623 - 51 -
1 (a) Suit in name of taxing district.--The officer may sue in
2 the name of the taxing district for the recovery of taxes due
3 and unpaid under the ordinance.
4 (b) Limitation on commencement of action.--Any suit brought
5 to recover the tax imposed by the ordinance or resolution shall
6 be brought within three years after the tax is due, or within
7 three years after the declaration or return has been filed,
8 whichever date is later. This limitation shall not, however,
9 prevent the institution of a suit for the collection of any tax
10 due or determined to be due in the following cases:
11 (1) Where no declaration or return was filed by any
12 person although a declaration or return was required to be
13 filed by him under provisions of the ordinance or resolution,
14 there shall be no limitation.
15 (2) Where an examination of the declaration or return
16 filed by any person, or of other evidence relating to the
17 declaration or return in the possession of the officer,
18 reveals a fraudulent evasion of taxes, there shall be no
19 limitation.
20 (3) In the case of substantial understatement of tax
21 liability of 25% or more and no fraud, suit shall be brought
22 within six years.
23 (4) Where any person has deducted taxes under the
24 provisions of the ordinance or resolution, and has failed to
25 pay the amounts so deducted to the officer, or where any
26 person has willfully failed or omitted to make the deductions
27 required by this section, there shall be no limitation.
28 (5) This section shall not be construed to limit the
29 governing body from recovering delinquent taxes by any other
30 means provided by this part.
19830H0555B0623 - 52 -
1 (c) Suit for recovery of erroneous refund.--The officer may
2 sue for recovery of an erroneous refund, provided the suit is
3 begun two years after making the refund, except that the suit
4 may be brought within five years if it appears that any part of
5 the refund was induced by fraud or misrepresentation of material
6 fact.
7 Section 3312. Interest and penalties.
8 If, for any reason the tax under this part is not paid when
9 due, interest at the rate of 10% per annum of the amount of said
10 tax and an additional penalty of 1% of the amount of the unpaid
11 tax for each month or fraction thereof during which the tax
12 remains unpaid, shall be added and collected. Where suit is
13 brought for the recovery of any tax, the person liable therefor
14 shall, in addition, be liable for the costs of collection and
15 the interest and penalties herein imposed.
16 Section 3313. Fines and penalties.
17 (a) Failure to make returns or pay taxes.--Any person who
18 fails, neglects or refuses to make any declaration or return
19 required by the ordinance or resolution, any employer who fails,
20 neglects or refuses to register or to pay the tax deducted from
21 his employees, or fails, neglects or refuses to deduct or
22 withhold the tax from his employees, any person who refuses to
23 permit the officer or any agent designated by him to examine his
24 books, records and papers, and any person who knowingly makes
25 any incomplete, false or fraudulent return, or attempts to do
26 anything whatsoever to avoid the full disclosure of the amount
27 of his income in order to avoid the payment of the whole or any
28 part of the tax imposed by the ordinance or resolution, shall,
29 upon conviction thereof before any district justice of competent
30 jurisdiction in the county or counties in which the political
19830H0555B0623 - 53 -
1 subdivision imposing the tax is located, be guilty of a summary
2 offense.
3 (b) Divulging of confidential information.--Any person who
4 divulges any information which is confidential under the
5 provisions of the ordinance or resolution, shall, upon
6 conviction thereof before any district justice, be guilty of a
7 summary offense.
8 (c) Penalties cumulative.--The penalties imposed under this
9 section shall be in addition to any other penalty imposed by any
10 other section of the ordinance or resolution.
11 (d) Failure to procure or receive forms no defense.--The
12 failure of any person to receive or procure forms required for
13 making the declaration or returns required by the ordinance or
14 resolution shall not excuse him from making the declaration or
15 return.
16 Section 3314. Payment of tax to other municipal corporations
17 or states as credit or deduction.
18 (a) General rule.--Except as provided in subsection (b),
19 payment of any tax to any city of the first class pursuant to an
20 ordinance or resolution passed or adopted prior to the effective
21 date of this part and continued under the authority of Chapter
22 31 shall be credited to and allowed as a deduction from the
23 liability of taxpayers for any income tax imposed by any other
24 municipal corporation of this Commonwealth under this chapter.
25 (b) Payments to first class cities by nonresident.--Payment
26 of any tax to any city of the first class by a nonresident of
27 said city shall not be credited to or allowed as a deduction
28 from the liability of that taxpayer for any income tax imposed
29 pursuant to this chapter by the municipal corporation in which
30 that taxpayer resides.
19830H0555B0623 - 54 -
1 (c) Income taxes.--Payment of any tax on income to a
2 municipal corporation by residents thereof pursuant to an
3 ordinance or resolution passed or adopted under the authority of
4 this chapter shall be credited to and allowed as a deduction
5 from the liability of those persons for any other tax
6 respectively on income imposed by any other municipal
7 corporation of this Commonwealth under this chapter.
8 (d) Deduction.--Payment of any tax on income to any
9 municipal corporation by residents thereof pursuant to an
10 ordinance or resolution passed or adopted under this chapter
11 shall be credited in the proportion as hereinafter set forth and
12 allowed as a deduction from the liability of those persons for
13 any other tax on income imposed by any other municipal
14 corporation of this Commonwealth under this chapter.
15 (e) Tax payments to political subdivisions outside the
16 Commonwealth.--Payment of any tax on income to any political
17 subdivision located outside of the Commonwealth by residents
18 thereof, pursuant to any State or local law, shall, to the
19 extent that the tax is on income in the proportions as
20 hereinafter set forth, be credited to and allowed as a deduction
21 from the liability of that person for any other tax on income
22 imposed by any municipal corporation of this Commonwealth under
23 this chapter, if residents of the municipal corporation within
24 the Commonwealth receive credits and deductions of a similar
25 kind to a like degree from the tax on income imposed by the
26 political subdivision of the other state.
27 (f) Tax payments to other states.--Payment of any tax on
28 income to any state other than Pennsylvania or to any political
29 subdivision located outside the boundaries of this Commonwealth,
30 by residents of a municipal corporation located within the
19830H0555B0623 - 55 -
1 Commonwealth shall, to the extent that the tax is on income in
2 the proportions as hereinafter set forth, be credited to and
3 allowed as a deduction from the liability of that person for any
4 other tax on income imposed by any municipal corporation of this
5 Commonwealth under this chapter.
6 (g) Proportion and amount of credit or deduction.--Where a
7 credit or a deduction is allowable in any of the several cases
8 hereinabove provided, it shall be allowed in proportion to the
9 concurrent periods for which taxes are imposed by the other
10 state or respective political subdivisions, but not in excess of
11 the amount previously paid for a concurrent period.
12 (h) Limitation on certain credits or deductions.--No credit
13 or deduction shall be allowed against any tax on income imposed
14 under this chapter to the extent of the amount of credit or
15 deduction taken for the same period by the taxpayer against any
16 income tax imposed by the Commonwealth under section 314 of the
17 act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code
18 of 1971, on account of taxes imposed on income by other states
19 or by their political subdivisions.
20 (i) Proportion of certain credits.--In the case of tax paid
21 on income to any state other than Pennsylvania or to any
22 political subdivision located outside the boundaries of the
23 Commonwealth by residents of a municipal corporation located
24 within the Commonwealth, the credit provided in this section
25 shall not exceed the proportion of the income tax otherwise due
26 that the amount of the taxpayer's income subject to tax by the
27 other jurisdiction bears to his entire taxable income.
28 CHAPTER 35
29 TAX LIMITATION, COLLECTION AND PENALTIES
30 Section 3501. Tax limitations.
19830H0555B0623 - 56 -
1 (a) Overall limit of tax revenues.--The aggregate amount of
2 all taxes imposed by any municipal corporation and in effect
3 during any fiscal year shall not exceed the tax revenues
4 collected for the preceding fiscal year by a greater percentage
5 than the percentage increase in total personal income of
6 Pennsylvania residents during the preceding calendar year as
7 published by the United States Department of Commerce, Bureau of
8 Economic Analysis. In the event a municipal corporation deems it
9 necessary to exceed the limit provided in this subsection, it
10 shall be required to appear at a public hearing before the court
11 of common pleas in the county in which it is situated. The
12 municipal corporation shall give public notice of this hearing
13 and of the proposed tax rates to be implemented only for the
14 upcoming fiscal year by:
15 (1) publishing the notice twice in a "newspaper of
16 general circulation," as defined in 45 Pa.C.S. § 101
17 (relating to definitions), which is published and circulated
18 and which has a bona fide paid circulation equal to or
19 greater than any newspaper published in the municipal
20 corporation; and
21 (2) posting a copy of the notice prominently in each
22 public school located within the municipal corporation. This
23 notice shall be published and posted at least 30 but not more
24 than 60 days prior to the date of the public hearing. It
25 shall be the responsibility of the municipal corporation to
26 show to the court of common pleas, by a preponderance of
27 evidence, that the proposed increase is in fact necessary and
28 substantiated. Should the court of common pleas deem the
29 proposed increase valid and effective, the municipal
30 corporation may levy taxes at the proposed rate only for the
19830H0555B0623 - 57 -
1 school fiscal year in question.
2 (b) Reduction of rates where taxes exceed limitations and
3 use of excess moneys.--If, during any fiscal year, it shall
4 appear that the aggregate revenues from taxes levied and
5 collected under this part will materially exceed the limitations
6 imposed by this part, the municipal corporation shall forthwith
7 reduce the rate or rates of the tax or taxes to stay within the
8 limitations as nearly as may be. Any one or more persons liable
9 for the payment of taxes levied and collected under this part
10 shall have the right to complain to the court of common pleas of
11 the county in an action of mandamus to compel compliance with
12 the preceding provision of this subsection. Tax moneys levied
13 and collected in any fiscal year in excess of the limitations
14 imposed by this part shall not be expended during that year, but
15 shall be deposited in a separate account in the treasury of the
16 municipal corporation for expenditure in the following fiscal
17 year. The rates of taxes imposed under this part for the
18 following fiscal year shall be so fixed that the revenues
19 thereby produced, together with the excess tax moneys on deposit
20 as aforesaid, shall not exceed the limitations imposed by this
21 part.
22 Section 3502. Collection of delinquent income taxes and
23 municipal services charges from employers.
24 (a) Notice and demand.--The tax collector shall demand,
25 receive and collect from all corporations, political
26 subdivisions, associations, companies, firms or individuals,
27 employing persons owing delinquent income and municipal services
28 taxes, or whose spouse owes delinquent income and municipal
29 services taxes, or having in possession unpaid commissions or
30 earnings belonging to any person or persons owing delinquent
19830H0555B0623 - 58 -
1 income taxes and municipal services charges, or whose spouse
2 owes delinquent income taxes and municipal services charges,
3 upon the presentation of a written notice and demand certifying
4 that the information contained therein is true and correct and
5 containing the name of the taxable or the spouse thereof and the
6 amount of tax due.
7 (b) Duty of employer.--Upon the presentation of written
8 notice and demand, it shall be the duty of any corporation,
9 political subdivision, association, company, firm or individual
10 to deduct from the wages, commissions or earnings of individual
11 employees, then owing or that shall within 60 days thereafter
12 become due, or from any unpaid commissions or earnings of any
13 taxable in its or his possession, or that shall within 60 days
14 thereafter come into its or his possession, a sum sufficient to
15 pay the respective amount of the delinquent income taxes and
16 municipal services charges and costs, shown upon the written
17 notice or demand, and to pay the same to the tax collector of
18 the taxing district in which the delinquent tax was levied
19 within 60 days after the notice shall have been given. No more
20 than 10% of the wages, commissions or earnings of the delinquent
21 taxpayer or spouse thereof may be deducted at any one time for
22 delinquent income taxes and municipal services charges and
23 costs. A corporation, political subdivision, association, firm
24 or individual shall be entitled to deduct from the moneys
25 collected from each employee the costs incurred from the extra
26 bookkeeping necessary to record those transactions, not
27 exceeding 2% of the amount of money so collected and paid over
28 to the tax collector.
29 (c) Penalty.--Upon the failure of any corporation, political
30 subdivision, association, company, firm or individual to deduct
19830H0555B0623 - 59 -
1 the amount of taxes or charges or to pay the same over to the
2 tax collector, less the cost of bookkeeping involved in the
3 transaction, as herein provided, within the time hereby
4 required, the corporation, political subdivision, association,
5 company, firm or individual shall forfeit and pay the amount of
6 the tax or charge for each taxable whose taxes are not withheld
7 and paid over, or that are withheld and not paid over together
8 with a penalty of 10% added thereto, to be recovered by an
9 action of assumpsit in a suit to be instituted by the tax
10 collector or by the proper authorities of the taxing district,
11 as debts of like amount are now by law recoverable, except that
12 a person shall not have the benefit of any stay of execution or
13 exemption law. The tax collector shall not proceed against a
14 spouse or his employer until he has pursued collection remedies
15 against the delinquent taxpayer and his employer under this
16 section.
17 Section 3503. Collection of delinquent income taxes and
18 municipal services charges from the Commonwealth.
19 Upon presentation of a written notice and demand under oath
20 or affirmation, to the State Treasurer or any other fiscal
21 officer of the State, or its boards, authorities, agencies or
22 commissions, it shall be the duty of the treasurer or officer to
23 deduct from the wages then owing, or that shall within 60 days
24 thereafter become due to any employee, a sum sufficient to pay
25 the respective amount of the delinquent income tax and municipal
26 services charges and costs shown on the written notice. The same
27 shall be paid to the tax collector of the taxing district in
28 which said delinquent tax was levied within 60 days after the
29 notice shall have been given.
30 Section 3504. Penalties.
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1 (a) Authority to prescribe and enforce.--Except as otherwise
2 provided in the case of any tax levied and assessed upon income,
3 any political subdivision shall have power to prescribe and
4 enforce reasonable penalties for the nonpayment, within the time
5 fixed for their payment, of taxes or charges imposed under
6 authority of this part and for the violations of the provisions
7 of ordinances or resolutions passed under authority of this
8 part.
9 (b) Interest, additional penalties and cost of collection.--
10 If, for any reason any tax or charge levied and assessed upon
11 income by any political subdivision is not paid when due,
12 interest at the rate of 10% per annum on the amount of said tax
13 and an additional penalty of 0.5% of the amount of the unpaid
14 tax for each month or fraction thereof during which the tax
15 remains unpaid, shall be added and collected. When suit is
16 brought for the recovery of any tax, the person liable therefor
17 shall, in addition, be liable for the costs of collection and
18 the interest and penalties herein imposed.
19 Section 3505. Nonpreemption.
20 The authority to levy taxes under this part shall not be
21 preempted or otherwise invalidated by any other State tax or
22 local tax ordinance.
23 CHAPTER 37
24 PROPERTY TAX EXEMPTION
25 Section 3701. Property tax exemption.
26 Each county, city, borough, incorporated town, township and
27 school district may, by ordinance or resolution, exempt from its
28 taxes upon real property, any person who is eligible for
29 property tax or rent rebate pursuant to the act of March 11,
30 1971 (P.L.104, No.3), known as the Senior Citizens Rebate and
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1 Assistance Act. Such exemption may be in whole or in part, but
2 if in part, shall be based upon the same classifications as
3 contained in the Senior Citizens Rebate and Assistance Act. Each
4 taxing authority may adopt regulations for the processing of
5 claims for the exemption.
6 PART VI
7 MISCELLANEOUS PROVISIONS
8 CHAPTER 99
9 SAVINGS PROVISIONS, REPEALS AND EFFECTIVE DATE
10 Section 9901. Saving clause and limitations.
11 Notwithstanding anything contained in any law to the
12 contrary, the validity of any ordinance or part of any ordinance
13 or any resolution or part of any resolution and any amendments
14 or supplements thereto now or hereafter enacted or adopted by
15 any political subdivision of this Commonwealth for or relating
16 to the imposition, levy or collection of any tax, shall not be
17 affected or impaired by anything contained in this act.
18 Section 9902. Repeals.
19 (a) Limited repeals.--The following acts or parts of acts
20 are repealed insofar as they relate to the assessment, levy or
21 collection of per capita or occupation taxes in political
22 subdivisions other than cities of the first class and school
23 districts of the first class:
24 Section 2531 of the act of June 23, 1931 (P.L.932, No.317),
25 known as The Third Class City Code.
26 Section 1709 of the act of June 24, 1931 (P.L.1206, No.331),
27 known as The First Class Township Code.
28 Section 905 of the act of May 1, 1933 (P.L.103, No.69), known
29 as The Second Class Township Code.
30 Sections 20, 20.1 and 21 of the act of May 25, 1945
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1 (P.L.1050, No.394), known as the Local Tax Collection Law.
2 Sections 655, 656, 674, 675, 676, 677 and 680 of the act of
3 March 10, 1949 (P.L.30, No.14), known as the Public School Code
4 of 1949.
5 Section 1302 of the act of February 1, 1966 (1965 P.L.1656,
6 No.581), known as The Borough Code.
7 (b) Absolute repeals.--The following acts or parts of acts
8 are hereby repealed absolutely:
9 Section 679 of the act of March 10, 1949 (P.L.30, No.14),
10 known as the Public School Code of 1949.
11 Act of December 31, 1965 (P.L.1257, No.511), known as The
12 Local Tax Enabling Act.
13 (c) General repeal.--All acts and parts of acts are repealed
14 insofar as they are inconsistent with this act.
15 Section 9903. Nonseverability.
16 The provisions of this act are nonseverable and if any such
17 provision is held invalid, the remaining provisions of this act
18 shall be void and school districts, counties and municipal
19 corporations shall revert to the taxing power they had prior to
20 enactment of this act.
21 Section 9904. Application of act.
22 This act shall apply to the 1984-1985 fiscal year or, if
23 appropriate, calendar year 1984.
24 Section 9905. Effective date.
25 This act shall take effect January 1, 1984.
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