See other bills
under the
same topic
PRINTER'S NO. 1053
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
600
Session of
2021
INTRODUCED BY KAIL, DUNBAR, MIHALEK, O'NEAL, ARMANINI,
BERNSTINE, BOBACK, CAUSER, A. DAVIS, DRISCOLL, HERSHEY, LEWIS
DELROSSO, MILLARD, MIZGORSKI, NEILSON, OBERLANDER, ROWE,
SCHWEYER, TOOHIL AND IRVIN, MARCH 26, 2021
REFERRED TO COMMITTEE ON FINANCE, MARCH 26, 2021
AN ACT
Establishing the Reshore to Restore Recovery Zone Program to
provide for reshore to restore recovery zones for the purpose
of granting tax exemptions, deductions, abatements or credits
to qualified individuals and businesses, restoring
deteriorated property and promoting manufacturing businesses;
providing for duties of the Commonwealth Financing Authority
and political subdivisions; and imposing penalties.
TABLE OF CONTENTS
Chapter 1. Preliminary Provisions
Section 101. Short title.
Section 102. Definitions.
Chapter 3. Establishment of Zones
Section 301. Establishment of program.
Section 302. Application for zone designation.
Section 303. Qualifications for zone designation.
Section 304. Qualifications for businesses.
Section 305. Form of applications.
Section 306. Prohibition on illegal immigrant labor.
Section 307. Prevailing wage.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
Section 308. Requirement to exclusively use construction
contractors that participate in apprenticeship
programs that meet State standards.
Chapter 5. State Taxes
Subchapter A. General Provisions
Section 501. State taxes.
Subchapter B. Particular State Taxes
Section 502. Sales and use tax.
Section 503. Personal income tax.
Section 504. Corporate net income tax.
Section 505. Reshore to restore recovery zone job creation tax
credit.
Section 506. Residency requirements.
Chapter 7. Local Taxes
Section 701. Local taxes.
Section 702. Real property tax.
Section 703. Local earned income and net profits taxes and
business privilege taxes.
Section 704. Mercantile license tax.
Section 705. Local sales and use tax.
Chapter 9. Administration of Tax Provisions
Section 901. Transferability.
Section 902. Recapture.
Section 903. Delinquent or deficient State or local taxes.
Section 904. Zoning, building and housing compliance.
Section 905. Notice requirements and State and local
authorities.
Section 906. Application time.
Chapter 11. Procedures for Zones
Section 1101. Relation to other programs.
20210HB0600PN1053 - 2 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Section 1102. Reporting.
Section 1103. Other Commonwealth tax credits.
Section 1104. Monitoring data.
Chapter 21. Miscellaneous Provisions
Section 2101. Illegal activity.
Section 2102. Regulations.
Section 2103. Compliance.
Section 2104. Penalties.
Section 2105. Construction.
Section 2106. Applicability.
Section 2107. Repeals.
Section 2108. Effective date.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
CHAPTER 1
PRELIMINARY PROVISIONS
Section 101. Short title.
This act shall be known and may be cited as the Reshore to
Restore Economic Recovery Act.
Section 102. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Authority." The Commonwealth Financing Authority.
"Department." The Department of Community and Economic
Development of the Commonwealth.
"Deteriorated property." A blighted, impoverished area
containing residential, industrial, commercial or other real
property that is abandoned, unsafe, vacant, undervalued,
underutilized, overgrown, defective, condemned, demolished or
20210HB0600PN1053 - 3 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
which contains economically undesirable land use.
"Manufacturing business." Any association, partnership,
corporation, sole proprietorship, limited liability company or
employer that engages in manufacturing.
"Program." The Reshore to Restore Recovery Zone Program
established under section 301(a).
"Qualified business." A business authorized to do business
in this Commonwealth which is located or partially located
within a zone and is engaged in the active conduct of a trade or
business in accordance with the requirements of section 304 for
the taxable year. An agent, broker or representative of a
business is not engaged in the active conduct of a trade or
business for the business.
"Qualified industry." Any of the following industries:
(1) Manufacturing of medical supply and critical health
care components.
(2) Life sciences.
(3) Food supply chain manufacturing.
(4) Robotics, information technology or automation.
(5) Advanced manufacturing.
(6) Providing air transportation of cargo without
transporting passengers over regular routes and on regular
schedules.
"Reshore to restore recovery zone." A defined geographic
area comprised of one or more political subdivisions or portions
of political subdivisions designated by the authority.
"Zone." A reshore to restore recovery zone.
CHAPTER 3
ESTABLISHMENT OF ZONES
Section 301. Establishment of program.
20210HB0600PN1053 - 4 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(a) Establishment.--The Reshore to Restore Recovery Zone
Program is established within the authority to provide for
reshore to restore recovery zones.
(b) Department of Community and Economic Development
relationship.--The authority may enter into an agreement under
64 Pa.C.S. § 1511(l) (relating to authority) in carrying out its
responsibilities under this act and to further the intent of
this act.
(c) Zone requirements.--A zone shall exceed no more than
5,000 acres and shall meet the requirements under section
303(a).
(d) Zone designation.--The authority shall designate not
more than 10 zones in this Commonwealth. Individuals and
businesses within an authorized zone that are qualified under
this act shall be entitled to all tax exemptions, deductions,
abatements or credits specified under this act for a period not
to exceed seven years beginning January 1, 2022, and ending
before December 31, 2029.
(e) Local tax exemptions.--A political subdivision where a
proposed zone is located, in whole or in part, shall provide tax
exemptions, deductions, abatements or credits to individuals and
businesses qualified under this act. The political subdivision
shall agree to provide exemptions, deductions, abatements or
credits from all local taxes specified under this act in order
for the property to be included in a zone. Except as otherwise
provided under this act, the exemptions, deductions, abatements
or credits under this subsection shall take effect January 1,
2022, if the designation of a zone is granted by the authority
within a political subdivision. The exemptions, deductions,
abatements or credits under this subsection shall be binding
20210HB0600PN1053 - 5 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
upon a political subdivision for the duration of the zone
designation.
Section 302. Application for zone designation.
(a) Initial applications.--Any individual, business or
political subdivision may apply to the authority to designate a
zone within the political subdivision or a portion of the
political subdivision. The application shall contain all of the
following information:
(1) The geographic area of the proposed zone. The
geographic area shall be located within the boundaries of the
participating political subdivision and shall not contain
more than 5,000 acres.
(2) A strategic plan that shall include all of the
following information:
(i) A detailed map of the proposed zone, including
geographic boundaries, total area and present use and
conditions of the land and structures of the proposed
zone.
(ii) Evidence of the support from and participation
of the governing body of the political subdivision,
school districts and other educational institutions,
business groups, community organizations and the public.
(iii) A proposal to increase economic opportunity,
reduce the local regulatory burden and identify potential
jobs and job training opportunities. The proposal under
this subparagraph shall state whether or not the zone is
located in an area which has tax revenue dedicated to the
payment of debt.
(iv) A description of the current social, economic
and demographic characteristics of the proposed zone and
20210HB0600PN1053 - 6 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
anticipated enhancements in employment that will result
from the zone designation.
(v) A description of anticipated activity in the
proposed zone. The description under this subparagraph
shall include increased opportunities for the development
of a qualified industry.
(vi) Evidence of potential private and public
investment in the proposed zone.
(vii) The role of the proposed zone in regional
economic and community development.
(viii) Any other information deemed appropriate by
the authority.
(3) A formal, binding ordinance or resolution passed by
the political subdivision where the proposed zone will be
located that specifically provides for all local tax
exemptions, deductions, abatements or credits for individuals
and businesses authorized under this act.
(4) Evidence that the proposed zone meets the criteria
required under section 303.
(b) Eligibility.--
(1) In order to be eligible for a zone designation, the
authority must receive an application from an individual,
business or political subdivision no later than December 15,
2021.
(2) The authority shall review the application and, if
approved, issue a certification of each tax exemption,
deduction, abatement or credit under this act for the zone
within two months of receipt of the application and any
additional required information.
(3) The authority must act on an application for a
20210HB0600PN1053 - 7 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
designation under this section by December 15, 2021.
(4) The authority may make designations under this
section on a rolling basis during the application period.
Section 303. Qualifications for zone designation.
(a) Required criteria.--In order to qualify for a
designation as a zone under this act, a proposed zone shall meet
all of the following criteria:
(1) The proposed zone shall have the ability to provide
opportunities in a qualified industry.
(2) The proposed zone shall include deteriorated
property or underutilized or unoccupied property that:
(i) has at least one border that is within 10 miles
of an institution of higher education;
(ii) has at least one border that is within 50 miles
of the existing business operations of a business
included in an application under section 302;
(iii) will provide petrochemical business or
downstream business opportunities with adequate
infrastructure and access to natural gas and natural gas
liquids to support new or expanded development; or
(iv) has at least one border that is within 10 miles
of an area designated as a foreign trade zone.
(b) Additional criteria.--In addition to the required
criteria under subsection (a), the authority shall develop a
scoring mechanism to evaluate applications based on all of the
following criteria:
(1) Evidence of distress and adverse economic and
socioeconomic conditions in the proposed zone.
(2) The quality and number of jobs created, including
the average wage of the jobs created, the nature and
20210HB0600PN1053 - 8 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
character of jobs created and attendant solutions for
mobility and congestion due to an increased workforce.
(3) The strength and viability of the proposed goals,
objectives and strategies in the strategic plan.
(4) Whether the strategic plan under section 302(a)(2)
is creative and innovative in comparison to other
applications.
(5) Whether the strategic plan under section 302(a)(2)
includes a community benefits plan.
(6) Direct benefits to the community as provided in the
strategic plan under section 302(a)(2), including
contributions to cultural vitality.
(7) Local public and private commitment to the
development of the proposed zone and the potential
cooperation of surrounding communities.
(8) Existing resources available to the proposed zone.
(9) How zone designation or economic redevelopment
relates to other current economic and community development
projects and to regional initiatives or programs.
(10) Proposals to maximize job creation.
(11) Current business practices, including compliance
with environmental regulations, mandates and current labor
force practices.
(c) Tax exemption ordinances.--An area may not be authorized
as a zone unless, as a part of the application, the political
subdivision where the proposed zone is to be located adopts and
provides a copy of an ordinance, resolution or other required
action to the authority from the governing body of the political
subdivision that exempts or provides deductions, abatements or
credits to qualified individuals and qualified businesses from
20210HB0600PN1053 - 9 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
local taxes upon designation of the area as a zone. An
appropriate ordinance and resolution under this subsection must
take effect on or before January 1, 2022, if the designation as
a zone is granted. A resolution, ordinance or other required
action under this subsection shall be binding and nonrevocable
on the qualified political subdivision for the duration of the
zone.
Section 304. Qualifications for businesses.
(a) Qualifications.--In order to qualify each year for a tax
exemption, deduction, abatement or credit under this act, a
business shall own or lease real property in a zone from which
the business actively conducts or provides support to a
qualified industry.
(b) Certification.--A qualified business shall receive
certification from the authority that the business meets the
qualifications under subsection (a). The business shall obtain
an annual renewal of the certification from the authority to
continue to qualify for a tax exemption, deduction, abatement or
credit under this act. The certification form shall include, but
not be limited to, all of the following information:
(1) The duration of the zone designation.
(2) The number of jobs created.
(3) The number of jobs retained.
(4) The amount of capital investment.
(5) Any other information, conditions or requirements
reasonably required by the authority.
(c) Relocation.--A business that relocates from outside of a
zone into a zone shall not receive any of the exemptions,
deductions, abatements or credits provided under this act unless
the business does any of the following:
20210HB0600PN1053 - 10 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(1) Increases full-time employment by at least 20% in
the first full year of operation within the zone.
(2) Makes a capital investment in the property located
within the zone equivalent to at least 10% of the gross
revenues of the business in the immediately preceding
calendar year or fiscal year.
(3) Enters into a lease agreement for a property located
within the zone:
(i) for a term equivalent to at least the duration
of the zone; and
(ii) with aggregate payment under the lease
agreement equivalent to at least 5% of the gross revenues
of the business in the immediately preceding calendar
year or fiscal year.
(d) Waiver.--The authority may waive or modify the
requirements under subsection (a) as appropriate.
Section 305. Form of applications.
(a) Forms.--An application for authorization as a zone shall
be on a form prescribed by the authority.
(b) Authority assistance.--The authority shall assist
political subdivisions in using the Internet as a tool for
encouraging new business development, including assisting
political subdivisions in making available, via the Internet,
information, applications and other forms necessary under this
act.
Section 306. Prohibition on illegal immigrant labor.
(a) Prohibition.--An individual or business that receives a
tax exemption, deduction, abatement or credit under this act may
not knowingly permit the labor services of an illegal immigrant
under a contract to which the individual or business is a party
20210HB0600PN1053 - 11 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
in the applicable zone. An individual or business shall be
deemed to have knowingly employed or knowingly permitted the
services under this subsection if the individual or business has
active knowledge of or had reason to know that the services have
been provided under the contract in the applicable zone.
(b) Reimbursement.--As a condition of the receipt of a tax
exemption, deduction, abatement or credit under this act, a
political subdivision or authority that awards the tax
exemption, deduction, abatement or credit under this act shall
require full repayment of the value or amount of the tax
exemption, deduction, abatement or credit if subsection (c)
applies.
(c) Violations.--
(1) Repayment under subsection (b) shall be required if
any of the following apply:
(i) The individual or business that received the tax
exemption, deduction, abatement or credit under this act
is sentenced under Federal law for an offense involving
knowing use of labor by an illegal immigrant under the
contract in the applicable zone.
(ii) All of the following apply:
(A) A contractor to an individual or business
that received the tax exemption, deduction, abatement
or credit under this act is sentenced under Federal
law for an offense involving knowing use of labor by
an illegal immigrant under the contract.
(B) The individual or business knew or had
reason to know of the contractor's knowing use of
labor by an illegal immigrant under the contract.
(2) An individual or business that is required to repay
20210HB0600PN1053 - 12 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
the Commonwealth or a political subdivision under this
section shall be ineligible to apply for a tax exemption,
deduction, abatement or credit under this act for a period of
two years.
(3) It shall be an affirmative defense to a violation of
this section if the individual or business contracts with a
contractor to provide labor under the contract in the
applicable zone and establishes that the contractor has
certified compliance with the requirements of section 274A of
the Immigration Reform and Control Act of 1986 (Public Law
99-603, 8 U.S.C. § 1324A) with respect to the hiring,
recruiting or referral for employment of an immigrant in the
United States and has notified the appropriate Federal
authority, if the individual or business knew that the
contractor used labor by an illegal immigrant.
(d) Definition.--As used in this section, the term "illegal
immigrant" means a noncitizen of the United States who is
violating Federal immigration laws and is providing compensated
labor within this Commonwealth.
Section 307. Prevailing wage.
For construction projects in zones, applicants, contractors
and subcontractors shall comply with general prevailing minimum
wage rates, as determined by the Secretary of Labor and
Industry. The wages shall be paid for each craft or
classification of workers needed to perform work on the project.
Section 308. Requirement to exclusively use construction
contractors that participate in apprenticeship
programs that meet State standards.
(a) Prohibition.--An individual or business that receives an
exemption, deduction, abatement or credit under this act may not
20210HB0600PN1053 - 13 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
enter into any agreement or contract with a contractor to
perform construction work with the contractor's employees or by
using a subcontractor unless the contractor and the contractor's
subcontractors provide an apprenticeship program which meets the
standards established by the State Apprenticeship and Training
Council under the act of July 14, 1961 (P.L.604, No.304), known
as The Apprenticeship and Training Act.
(b) Reimbursement.--As a condition of the receipt of an
exemption, deduction, abatement or credit under this act, the
authority or political subdivision that awards the exemption,
deduction, abatement or credit under this act shall require full
repayment of the value or amount of the tax exemption,
deduction, abatement or credit if the individual or business
fails to meet the requirements under subsection (a).
(c) Ineligibility period.--An individual or business who is
required to repay the Commonwealth or a political subdivision
under this section shall be ineligible to apply for a tax
exemption, deduction, abatement or credit under this act for a
period of two years after the individual or business has
established that the individual or business has complied with
the repayment requirements under subsection (b).
CHAPTER 5
STATE TAXES
SUBCHAPTER A
GENERAL PROVISIONS
Section 501. State taxes.
(a) Individual exemptions.--An individual who is a resident
of a zone, a qualified business or a nonresident shall receive
the exemptions, deductions, abatements or credits as provided
under this chapter and Chapter 7 for the duration of the zone
20210HB0600PN1053 - 14 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
designation. Exemptions, deductions, abatements or credits shall
expire on the date of expiration of the zone designation.
(b) Construction.--The Department of Revenue shall
administer, construe and enforce the provisions of this chapter
in conjunction with Articles II, III, IV, VII, IX and XV of the
act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code
of 1971.
SUBCHAPTER B
PARTICULAR STATE TAXES
Section 502. Sales and use tax.
Sales at retail of services or tangible personal property,
other than motor vehicles, to a qualified business or a
construction contractor under a construction contract with a
qualified business, landowner or lessee for the exclusive use,
consumption and utilization of the tangible personal property or
service by the qualified business at the facility of the
qualified business, landowner or lessee located within a zone
shall be exempt from the sales and use tax imposed under Article
II of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
Reform Code of 1971. An exemption shall not be allowed for sales
conducted prior to the designation of the real property as part
of a zone.
Section 503. Personal income tax.
(a) Exemption.--An individual shall be allowed an exemption
for any of the following:
(1) Compensation received during the time period when
the individual was a resident of a zone.
(2) Net income from the operation of a qualified
business received by a resident or nonresident of a zone
attributable to business activity conducted within a zone,
20210HB0600PN1053 - 15 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
determined in accordance with section 504. A business that
operates both inside and outside of this Commonwealth, before
computing the business' zone exemption, shall first determine
the business' Pennsylvania activity over its activity outside
of this Commonwealth by applying the three-factor
apportionment formula described in the Department of
Revenue's personal income tax regulations applicable to
income apportionment in connection with a business, trade or
profession carried on both inside and outside of this
Commonwealth.
(3) All of the following:
(i) Net gains or income, less net losses, derived by
a resident or nonresident of a zone from the sale,
exchange or other disposition of real or tangible
personal property located in a zone as determined in
accordance with accepted accounting principles and
practices. The exemption provided under this subparagraph
shall not apply to the sale, exchange or other
disposition of any stock of goods, merchandise or
inventory, or any operational assets unless the transfer
is in connection with the sale, exchange or other
disposition of all of the assets in complete liquidation
of a qualified business located in a zone. This
subparagraph shall apply to intangible personal property
employed in a trade, profession or business in a zone by
a qualified business, but only when transferred in
connection with a sale, exchange or other disposition of
all of the assets in complete liquidation of the
qualified business in the zone. The exemption from income
for gain or loss provided for under this subparagraph
20210HB0600PN1053 - 16 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
shall be prorated based on the calendar days the property
located in a zone was held by a resident or nonresident
of the zone during the time period the zone was in effect
in relation to the total time the property was held.
(ii) Net gains, less net losses, realized by a
resident of a zone from the sale, exchange or disposition
of intangible personal property or obligations issued by
the Commonwealth, a public authority, commission, board
or other Commonwealth agency, political subdivision or
authority created by a political subdivision or by the
Federal Government as determined in accordance with
accepted accounting principles and practices. The
exemption from income for gain or loss provided for under
this subparagraph shall be based on calendar days the
property was held by the taxpayer while a resident of a
zone in relation to the total time the property was held.
(4) Net gains or income derived from or in the form of
rents received by an individual, whether or not a resident of
a zone, to the extent that income or loss from the rental of
real or tangible personal property is allocable to a zone.
For the purpose of calculating the exemption under this
paragraph, the following apply:
(i) Net rents derived from real or tangible personal
property located in a zone shall be allocable to a zone.
(ii) If the tangible personal property was used both
inside and outside of the zone during the taxable year,
only the net income attributable to use in the zone shall
be exempt. The net rental income shall be multiplied by a
fraction, the numerator of which is the number of days
the property was used in the zone and the denominator of
20210HB0600PN1053 - 17 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
which is the total days of use.
(5) Dividends received during the time period the
individual was a resident of a zone.
(6) Interest received during the time period the
individual was a resident of a zone.
(7) The part of the income or gains received by an
estate or trust for its taxable year ending within or outside
the resident-beneficiary's taxable year which, under the
governing instrument and applicable State law, is required to
be distributed currently or is in fact paid or credited to
the resident-beneficiary and which would have been exempt
under this act if received by a resident-beneficiary
directly.
(b) Exemption.--Beginning in taxable year 2022, an
individual located in a designated zone shall be allowed an
exemption under subsection (a) from the tax imposed by Article
III of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
Reform Code of 1971, for the classes of income specified under
subsection (a). An individual shall not be allowed an exemption
for activities conducted prior to designation of the real
property as part of a zone.
(c) Pass-through entities.--The exemptions provided for
under subsection (a)(2), (3)(i) and (4) shall apply to all of
the following:
(1) The income or gain of a partnership or association.
The partner or member shall be entitled to the exemptions
under this section for the partner's or member's share,
whether or not distributed, of the income or gain received by
the partnership or association for its taxable year.
(2) The income or gain of a Pennsylvania S corporation.
20210HB0600PN1053 - 18 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
The shareholder shall be entitled to the exemptions under
this section for the shareholder's pro rata share, whether or
not distributed, of the income or gain received by the
corporation for its taxable year ending within or outside the
shareholder's taxable year.
(3) The income or gain of a limited liability company.
The member shall be entitled to the exemptions under this
section for the member's pro rata share, whether or not
distributed, of the income or gain received by the limited
liability company for its taxable year ending within or
outside the member's taxable year.
(d) Limitation.--A partnership, association, Pennsylvania S
corporation, sole proprietorship, limited liability company,
resident or nonresident may not apply an exemption from income
under this act for any class of income against any other classes
of income or gain. A partnership, association, Pennsylvania S
corporation, resident or nonresident may not carry back or carry
forward any exemption under this act from year to year. The
credit allowed under this section shall not exceed the tax
liability of the taxpayer under Article III of the Tax Reform
Code of 1971 for the tax year.
(e) Nonapplicability.--Any portion of net income or gain
that is attributable to operation of a railroad, truck, bus or
airline company or entity which would qualify as a regulated
investment company under Article IV of the Tax Reform Code of
1971 shall not be used to calculate an exemption under this
section. This subsection shall not apply to the exemption from
tax provided under subsection (a)(5).
Section 504. Corporate net income tax.
(a) Credits.--For tax years beginning on or after January 1,
20210HB0600PN1053 - 19 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
2022, a corporation that is a qualified business under this act
may claim a credit against the tax imposed by Article IV of the
act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code
of 1971, for tax liability attributable to business activity
conducted within the zone in the taxable year. A credit may not
be claimed for activities conducted prior to designation of the
real property as part of a zone. The business activity shall be
conducted directly by a corporation in the zone in order for the
corporation to claim the tax credit.
(b) Tax liability determinations.--The corporate tax
liability attributable to business activity conducted within a
zone shall be determined by multiplying the corporation's
taxable income that is attributable to business activity
conducted within the zone by the rate of tax imposed under
Article IV of the Tax Reform Code of 1971 for the taxable year.
(c) Attributable tax liability.--Tax liability attributable
to business activity conducted within a zone shall be computed,
construed, administered and enforced in conformity with Article
IV of the Tax Reform Code of 1971 and as follows:
(1) If the entire business of the corporation in this
Commonwealth is transacted wholly within the zone, the
taxable income attributable to business activity within the
zone shall consist of the Pennsylvania taxable income as
determined under Article IV of the Tax Reform Code of 1971.
(2) If the entire business of the corporation in this
Commonwealth is not transacted wholly within the zone, the
taxable income of a corporation in the zone shall be
determined upon the portion of the Pennsylvania taxable
income of the corporation attributable to business activity
conducted within the zone and apportioned in accordance with
20210HB0600PN1053 - 20 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
subsection (d).
(d) Income apportionment.--The taxable income of a
corporation that is a qualified business shall be apportioned to
the zone by multiplying the Pennsylvania taxable income by a
fraction, the numerator of which is the property factor plus the
payroll factor and the denominator of which is two, in
accordance with the following:
(1) The property factor is a fraction, the numerator of
which is the average value of the taxpayer's real and
tangible personal property owned or rented and used in the
zone during the tax period and the denominator of which is
the average value of all the taxpayer's real and tangible
personal property owned or rented and used in this
Commonwealth during the tax period, but shall not include the
security interest of any corporation as seller or lessor in
personal property sold or leased under a conditional sale,
bailment lease, chattel mortgage or other contract providing
for the retention of a lien or title as security for the
sales price of the property.
(2) As follows:
(i) The payroll factor is a fraction, the numerator
of which is the total amount paid in the zone during the
tax period by the taxpayer for compensation and the
denominator of which is the total compensation paid in
this Commonwealth during the tax period.
(ii) Compensation shall be considered paid in the
zone if any of the following apply:
(A) The individual's service is performed
entirely within the zone.
(B) The individual's service is performed both
20210HB0600PN1053 - 21 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
within and outside the zone, but the service
performed outside the zone is incidental to the
individual's service within the zone.
(C) Some of the service is performed in the zone
and the base of operations.
(D) If there is no base of operations, some of
the service is performed in the place from which the
service is directed or controlled is in the zone or
the base of operations or the place from which the
service is directed or controlled is not in any
location in which some part of the service is
performed, but the individual's residence is in the
zone.
(e) Computation.--A corporation shall compute its
Commonwealth taxable income in conformity with Article IV of the
Tax Reform Code of 1971 with no adjustments or subtractions for
energy enhancement zone taxable income.
(f) Limitation on amount of credit.--The credit allowed
under this section shall not exceed the tax liability of the
taxpayer under Article IV of the Tax Reform Code of 1971 for the
tax year.
Section 505. Reshore to restore recovery zone job creation tax
credit.
(a) Credits.--For tax years beginning on or after January 1,
2022, a qualified business under this act may apply to the
authority for a zone job creation tax credit against the tax
imposed by Article III or IV of the act of March 4, 1971 (P.L.6,
No.2), known as the Tax Reform Code of 1971. The credit shall be
for all full-time jobs created within a zone in the taxable
year. The job shall be held directly with the qualified business
20210HB0600PN1053 - 22 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
in the zone in order for the qualified business to apply for the
tax credit. The authority shall prescribe the form and manner to
obtain the credit.
(b) Relocation.--The following apply:
(1) A business that relocates from a location in a
political subdivision in this Commonwealth that is not in a
zone to a location in a zone may not apply for a credit for
an existing job that is transferred, discontinued or lost in
this Commonwealth and attributable to the relocation.
(2) A business that has relocated under paragraph (1)
and becomes a qualified business may apply for a zone job
creation tax credit for each new full-time job that is
created in the zone. A new full-time job shall be created
with a qualified business if the average monthly employment
for that qualified business has increased from the prior 12-
month calendar year in the zone.
(c) Application for credit.--A qualified business shall
apply for a credit under this section for the previous fiscal
year by January 15.
(d) Apportionment.--The authority shall apportion a zone job
creation tax credit for a business that is a qualified business
that has not operated in a zone for a full fiscal year.
(e) Credit determinations.--The zone job creation tax credit
shall be determined by multiplying the monthly average of all
full-time jobs by $1,250.
(f) Notification of credit.--By March 15 of each year, the
authority shall notify the qualified business of the amount of
the qualified business' job creation tax credit that was
approved.
(g) Allocation.--The total amount of credits approved by the
20210HB0600PN1053 - 23 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
authority under this section may not exceed $10,000,000
annually. If the credits exceed the $10,000,000 cap in a given
year, the credits shall be allocated on a pro rata basis.
(h) Calculation of allocation.--If the total amount of zone
job creation tax credits applied for by all qualified businesses
under this section exceeds $10,000,000, the credit to be
received by each qualified business shall be the product of
$10,000,000 multiplied by the quotient of the credit applied for
by the qualified business divided by the total of all credits
applied for by all qualified businesses, the algebraic
equivalent of which is:
qualified business zone job creation tax credit =
$10,000,000 x (the amount of zone job creation tax credit
applied for by the qualified business/the sum of all zone
job creation tax credits applied for by all qualified
businesses).
(i) Pass-through entities.--The zone job creation tax credit
shall apply to the following:
(1) A partner or member of a partnership or association
that qualifies under this section shall be entitled to a job
creation tax credit in proportion to the partner's or
member's share, whether or not distributed, of the income or
gain received by the partnership or association for its
taxable year.
(2) A shareholder of a Pennsylvania S corporation that
qualifies under this section shall be entitled to a job
creation tax credit in proportion to the shareholder's pro
rata share, whether or not distributed, of the income or gain
received by the corporation for its taxable year ending
within or outside the shareholder's taxable year.
20210HB0600PN1053 - 24 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(3) A member of a limited liability company that
qualifies under this section shall be entitled to a job
creation tax credit in proportion to the member's pro rata
share, whether or not distributed, of the income or gain
received by the limited liability company for its taxable
year ending within or outside the member's taxable year.
(4) A partnership, association, Pennsylvania S
corporation or limited liability company, or partner, member
or shareholder, may not claim any other tax benefit, expense
or credit for the same zone job creation tax credit.
Section 506. Residency requirements.
(a) Qualifications.--In order to qualify each year for a tax
exemption, deduction, abatement or credit under this act, an
individual shall be domiciled and shall reside in a zone for a
period of 184 consecutive days during each taxable year, which
may begin on the date of designation by the authority or on the
date the individual first resides within the zone.
(b) Residency considerations.--If an individual completes
the residency requirement under subsection (a) or if a
nonresident realizes income attributable to business activity or
property within a zone on or before the end of the tax year, the
individual may claim the exemptions from income for the items
specified under section 503 for that portion of the tax year
that the individual was a resident or for that portion of the
tax year during which the area is designated as a zone.
CHAPTER 7
LOCAL TAXES
Section 701. Local taxes.
(a) Local tax exemption.--A political subdivision in which a
zone is located shall exempt, deduct, abate or credit local
20210HB0600PN1053 - 25 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
taxes in accordance with ordinances and resolutions adopted to
comply with section 301(e).
(b) Noncompliance.--Failure to comply with subsection (a)
shall result in the revocation of the zone designation.
Section 702. Real property tax.
(a) Abatement.--Notwithstanding the act of May 22, 1933
(P.L.853, No.155), known as The General County Assessment Law,
and 53 Pa.C.S. Ch. 88 (relating to consolidated county
assessment), each qualified political subdivision for taxable
years beginning after December 31, 2021, shall by ordinance or
resolution abate 100% of the real property taxation on the
assessed valuation of deteriorated property in an area
designated as a zone within this Commonwealth.
(b) Applicability.--
(1) The real property tax abatement under this section
shall apply to all real property located in a zone,
irrespective of any business activity, made of the realty by
its owner on or after the effective date of this section.
(2) An abatement may not be provided to deteriorated
property prior to designation of the deteriorated property as
part of a zone.
(c) Investment in lieu of tax payment.--
(1) A qualified political subdivision may require a
resident of deteriorated real property, in order for the
residents to be qualified for exemptions, deductions,
abatements and credits under this section, to invest up to
25% of all real property taxes which would have been due if
the real property was not located in a zone in improvements
to the real property.
(2) A qualified political subdivision may require a
20210HB0600PN1053 - 26 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
nonresident owner of deteriorated real property who leases
the real property to an individual for residential use to
invest 50% of all real property taxes which would have been
due if the real property was not located in a zone in
improvements to the real property.
(d) Annual real property report.--By January 31 of each
year, an owner where a zone is located shall submit to the
political subdivision an annual report listing the address of
each real property in a designated zone and each real property's
owner of record.
(e) Interest and penalties.--An individual who claims an
abatement of real property tax to which the individual is not
entitled under this section shall be liable for the abated taxes
and subject to the applicable interest and penalty provisions
provided by the laws of this Commonwealth.
(f) Subsidy for school districts.--In determining the market
value of real property in each school district, the State Tax
Equalization Board shall exclude any increase in value above the
base value prior to the effect of the abatement of local taxes
to the extent and during the period of time that real estate tax
revenues attributable to the increased value are not available
to the school district for general school district purposes.
Section 703. Local earned income and net profits taxes and
business privilege taxes.
(a) General exemption.--
(1) If a political subdivision has enacted a tax on the
privilege of engaging in a business or profession, measured
by gross receipts or on a flat rate basis, by earned income
or by net profits, imposed within the boundaries of a zone,
except as specified in paragraph (2), the qualified political
20210HB0600PN1053 - 27 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
subdivision shall exempt all of the following from the tax:
(i) Business gross receipts for operations conducted
by a qualified business within a zone.
(ii) Earned income received by a resident of a zone.
(iii) Net profits of a qualified business
attributable to business activity conducted within the
zone.
(2) An exemption may not be granted for operations
conducted, for earned income received or for activities
conducted prior to designation of the real property as part
of a zone.
(b) Additional exemptions.--
(1) This subsection shall apply if a qualified political
subdivision has enacted a tax on the privilege of engaging in
a profession or business, on wages or compensation, on net
profits from the operation of a business or profession or
other activity or on the occupancy or use of real property
under any of the following:
(i) The act of August 5, 1932 (1st Sp.Sess., P.L.45,
No.45), referred to as the Sterling Act.
(ii) The act of March 10, 1949 (P.L.30, No.14),
known as the Public School Code of 1949.
(iii) The act of August 24, 1961 (P.L.1135, No.508),
referred to as the First Class A School District Earned
Income Tax Act.
(iv) The act of August 9, 1963 (P.L.640, No.338),
entitled "An act empowering cities of the first class,
coterminous with school districts of the first class, to
authorize the boards of public education of such school
districts to impose certain additional taxes for school
20210HB0600PN1053 - 28 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
district purposes, and providing for the levy, assessment
and collection of such taxes."
(v) The act of May 30, 1984 (P.L.345, No.69), known
as the First Class City Business Tax Reform Act.
(vi) The act of June 5, 1991 (P.L.9, No.6), known as
the Pennsylvania Intergovernmental Cooperation Authority
Act for Cities of the First Class.
(2) If a qualified political subdivision enacts a tax
specified under paragraph (1), the qualified political
subdivision shall provide an exemption, deduction, abatement
or credit from the imposition and operation of the local tax
ordinance or resolution for all of the following:
(i) The privilege of engaging in a business or
profession within a zone by an individual or a qualified
business, whether a resident or nonresident of the zone.
(ii) Salaries, wages, commissions, compensation or
other income received for services rendered or work
performed by a resident of the zone.
(iii) The gross or net income or gross or net
profits realized from the operation of a qualified
business to the extent attributable to business activity
conducted within the zone.
(iv) The occupancy or use of real property located
within the zone.
(c) Education subsidy for school districts.--
(1) Except as specified under paragraph (2), in
determining the personal income valuation of a school
district, the Secretary of Revenue shall exclude any increase
in personal income valuation above the base value prior to
the abatement of local taxes in a zone located within the
20210HB0600PN1053 - 29 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
school district to the extent and during the period of time
that personal income revenue attributable to the increase in
the personal income valuation is not available to the school
district for general school district purposes.
(2) An exemption under this section may not be granted
to an individual or qualified business prior to designation
of the real property as part of a zone.
(d) Determination of exemption.--For the purpose of
determining an exemption under this section, a tax on or
measured by any of the following shall be attributed to business
activity conducted within a zone by applying the apportionment
factors under section 504(d):
(1) Business gross receipts.
(2) Gross or net income.
(3) Gross or net profits.
(e) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Earned income." As defined in section 501 of the act of
December 31, 1965 (P.L.1257, No.511), known as The Local Tax
Enabling Act.
"Net profits." As defined in section 501 of The Local Tax
Enabling Act.
"Personal income valuation." As defined in section 2501(9.1)
of the Public School Code of 1949.
Section 704. Mercantile license tax.
An individual or qualified business in a zone may not be
required to pay a fee authorized under a mercantile license tax
imposed under the act of June 20, 1947 (P.L.745, No.320),
entitled "An act to provide revenue for school districts of the
20210HB0600PN1053 - 30 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
first class A by imposing a temporary mercantile license tax on
persons engaging in certain occupations and businesses therein;
providing for its levy and collection; for the issuance of
mercantile licenses upon the payment of fees therefor;
conferring and imposing powers and duties on boards of public
education, receivers of school taxes and school treasurers in
such districts; saving certain ordinances of council of certain
cities, and providing compensation for certain officers, and
employes and imposing penalties."
Section 705. Local sales and use tax.
(a) Applicable taxes.--This section applies to a tax imposed
by a political subdivision under any of the following:
(1) Subarticle E of Article XXXI-B of the act of July
28, 1953 (P.L.723, No.230), known as the Second Class County
Code.
(2) Chapter 5 of the act of June 5, 1991 (P.L.9, No.6),
known as the Pennsylvania Intergovernmental Cooperation
Authority Act for Cities of the First Class.
(3) Article II-B of the act of March 4, 1971 (P.L.6,
No.2), known as the Tax Reform Code of 1971.
(b) Exemption.--Except as described under subsection (c), a
political subdivision which enacts a tax specified under
subsection (a) shall exempt from the tax sales at retail of
services or tangible personal property, to a qualified business
or a construction contractor under a construction contract with
a qualified business, landowner or lessee for the exclusive use,
consumption and utilization of the tangible personal property or
service by the qualified business at the facility of the
qualified business, landowner or lessee located within a zone.
(c) Exception.--
20210HB0600PN1053 - 31 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(1) This section shall not apply to the sale at retail
of a motor vehicle.
(2) An exemption may not be granted for sales occurring
prior to designation of the real property as part of a zone.
(d) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Sale at retail." As defined in section 201(k) of the act of
March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971.
"Tangible personal property." As defined in section 201(m)
of the Tax Reform Code of 1971.
CHAPTER 9
ADMINISTRATION OF TAX PROVISIONS
Section 901. Transferability.
An exemption, deduction, abatement or credit provided to an
individual or a qualified business under Chapter 5 or 7 shall be
nontransferable and may not be applied, used or assigned to any
other individual, business or tax account.
Section 902. Recapture.
(a) Refund.--Except as specified under subsection (c), if a
qualified business located within a zone has received an
exemption, deduction, abatement or credit under this act and
subsequently relocates outside of the zone within the first five
years of locating in a zone, the business shall refund the
exemption, deduction, abatement or credit to the Commonwealth
and the political subdivision which granted the exemption,
deduction, abatement or credit.
(b) Amount.--The refund under subsection (a) shall be in the
amount of the following percentages of the exemptions,
20210HB0600PN1053 - 32 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
deductions, abatements or credits attributed to the qualified
business' participation in the zone:
(1) If the qualified business relocates within three
years from the date of first locating in a zone, 66%.
(2) If the qualified business relocates within three to
five years from the date of first locating in a zone, 33%.
(c) Exceptions.--
(1) If the qualified business was located within a
facility operated by a nonprofit organization to assist in
the creation and development of a start-up business, an
exemption, deduction, abatement or credit may not be
refunded.
(2) The Commonwealth or political subdivision may waive
or modify refund requirements under this section upon making
a determination that the business relocation was due to
circumstances beyond the control of the business, including
any of the following:
(i) A natural disaster.
(ii) Unforeseen industry trends.
(iii) A loss of a major supplier or market.
Section 903. Delinquent or deficient State or local taxes.
(a) Individuals.--An individual may not claim or receive an
exemption, deduction, abatement or credit under this act unless
that individual is in full compliance with the tax laws,
ordinances and resolutions of this Commonwealth.
(b) Qualified businesses.--
(1) A qualified business may not claim or receive an
exemption, deduction, abatement or credit under this act
unless that qualified business is in full compliance with the
tax laws, ordinances and resolutions of this Commonwealth.
20210HB0600PN1053 - 33 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(2) A qualified business may not claim or receive an
exemption, deduction, abatement or credit under this act if
an individual or business with a 20% or greater interest in
that qualified business is not in full compliance with the
tax laws, ordinances and resolutions of this Commonwealth.
(c) Later compliance and eligibility.--
(1) Subject to paragraph (2), an individual or a
qualified business that is not eligible to claim an
exemption, deduction, abatement or credit due to
noncompliance under subsection (b) may become eligible if the
individual or qualified business subsequently comes into full
compliance to the satisfaction of the authority or the
political subdivision within the calendar year in which the
noncompliance first occurred.
(2) If full compliance is not attained by February 5 of
the calendar year after the calendar year when noncompliance
first occurred, the individual or qualified business shall be
precluded from claiming any exemption, deduction, abatement
or credit for that calendar year, whether or not full
compliance is subsequently achieved.
(d) Tax appeals.--An individual or qualified business shall
be deemed to be in full compliance under this section if the
individual or qualified business:
(1) makes a timely administrative or judicial appeal for
the tax; or
(2) is in compliance with an authorized deferred payment
plan with the Department of Revenue or a political
subdivision for the tax.
Section 904. Zoning, building and housing compliance.
(a) Requirements.--An individual or qualified business shall
20210HB0600PN1053 - 34 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
be precluded from claiming an exemption, deduction, abatement or
credit provided for under this act if the individual or
qualified business owns real property in a zone and the real
property is not in compliance with applicable zoning, building
and housing statutes, regulations, ordinances and codes.
(b) Opportunity to achieve compliance.--
(1) Except as specified under paragraph (2), an
individual or qualified business that is not in compliance
under subsection (a) shall have until December 31 of the
calendar year after the designation of the real property as
part of a zone to be in compliance in order to claim an
exemption, deduction, abatement or credit for that year. If
the time limit under this paragraph is not met, the
individual or qualified business shall be precluded from
claiming an exemption, deduction or credit for that calendar
year, whether or not compliance is achieved in a subsequent
calendar year.
(2) The political subdivision may extend the time period
when an individual or a qualified business must come into
compliance with a local ordinance or building code for a
period not to exceed one year if the political subdivision
determines all of the following:
(i) The individual or qualified business has made
and will continue to make a good faith effort to come
into compliance.
(ii) An extension will enable the individual or
qualified business to achieve full compliance.
(c) Notice.--A qualified political subdivision shall
annually notify the authority in writing of all individuals or
qualified businesses that are not in compliance with this
20210HB0600PN1053 - 35 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
section by January 30 of each year.
Section 905. Notice requirements and State and local
authorities.
After compliance reviews have been conducted by appropriate
Commonwealth and political subdivision authorities, notice shall
be provided to each zone applicant by regular mail each year of
the approval or denial of the applicant's application. An
applicant shall not be entitled to a tax benefit unless the
applicant receives an approval under this section.
Section 906. Application time.
(a) Requirement.--Except as specified under subsection (b),
an applicant must file an application in a manner prescribed by
the authority by December 31 of the year for which the applicant
claims any exemption, deduction, abatement or credit under this
act.
(b) Extension or waiver.--Upon request of the applicant, the
authority may extend or waive the application deadline for good
cause if the political subdivision does not object to the waiver
or extension.
(c) Approval.--An exemption, deduction, abatement or credit
may not be claimed or received for a calendar year until
approval has been recommended by the authority.
CHAPTER 11
PROCEDURES FOR ZONES
Section 1101. Relation to other programs.
(a) Reduced interest.--Projects in a zone which are approved
for the authority or Small Business First Program financing
shall receive the lowest interest rate extended to borrowers.
(b) Priority consideration.--Projects in a zone shall
receive priority consideration for State assistance under State
20210HB0600PN1053 - 36 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
economic, community and economic development programs and
community building initiatives.
(c) Marketing.--The authority, in cooperation with political
subdivisions, shall develop and implement a consolidated
marketing strategy for a zone for use in job retention and
attraction activities.
(d) Local governments.--The Center for Local Government
Services in the Department of Community and Economic Development
shall do all of the following:
(1) Provide technical assistance to political
subdivisions relating to:
(i) Taxation.
(ii) Implementation of the strategic plan.
(iii) Establishment of annual benchmarks and
reporting requirements to the authority.
(2) Provide political subdivisions with property
designated as a zone with technical assistance to encourage
the implementation of best practices in achieving efficient
and effective local government administration.
(3) Coordinate activities with other Commonwealth
agencies providing various assistance to communities.
Section 1102. Reporting.
The authority shall report to the General Assembly on the
economic effects of this act in each zone every four years.
Section 1103. Other Commonwealth tax credits.
(a) Prohibition.--An individual or a qualified business that
is entitled to claim an exemption, deduction, abatement or
credit under this act may not claim or accumulate any of the
following tax credits:
(1) Research and development under Article XVII-B of the
20210HB0600PN1053 - 37 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform
Code of 1971.
(2) Job creation under Article XVIII-B of the Tax Reform
Code of 1971.
(3) Neighborhood assistance under Article XIX-A of the
Tax Reform Code of 1971.
(b) Outside of zone.--
(1) An individual or qualified business may apply an
exemption, deduction, abatement or credit to income realized
from activity or transactions outside the zone, but only for
the taxable year to which the exemption, deduction, abatement
or credit applies.
(2) This subsection applies only to the taxes specified
in Chapters 5 and 7.
Section 1104. Monitoring data.
The authority shall monitor all of the following:
(1) Verifiable job creation and job retention data.
(2) Information on the types of jobs created and average
hourly wages.
(3) Number of years in the program.
(4) Annual, unduplicated public and private capital
investment amounts.
(5) Business type and description.
(6) Types and amounts of other economic development
assistance received from the Commonwealth.
(7) Documentation that proper participants identified as
relocations meet the requirements of this act.
CHAPTER 21
MISCELLANEOUS PROVISIONS
Section 2101. Illegal activity.
20210HB0600PN1053 - 38 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Money and other forms of consideration received by an
individual or qualified business conducting illegal activity
shall not be eligible for any exemption, deduction, abatement or
credit or any other benefit created under this act.
Section 2102. Regulations.
The authority may promulgate regulations necessary to
effectuate the provisions of this act.
Section 2103. Compliance.
An individual or a qualified business eligible for an
exemption, deduction, abatement or credit under this act shall
comply with all reporting, filing and compliance requirements
under the act of March 4, 1971 (P.L.6, No.2), known as the Tax
Reform Code of 1971, unless otherwise provided for under this
act.
Section 2104. Penalties.
(a) Civil penalties.--In addition to a penalty under the act
of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971, the authority or the Department of Revenue may impose an
additional administrative penalty not to exceed $10,000 for any
act or violation of this act relating to State and local tax,
including the filing of any false statement, return or document.
(b) Criminal penalties.--In addition to a criminal penalty
under the Tax Reform Code of 1971, an individual that knowingly
violates this act commits a misdemeanor of the third degree.
Section 2105. Construction.
This act shall be interpreted to ensure that all provisions
relating to State and local tax exemptions, deductions,
abatements and credits are strictly construed in favor of the
Commonwealth.
Section 2106. Applicability.
20210HB0600PN1053 - 39 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
The provisions of this act shall be applied prospectively. An
individual or qualified business may not claim an exemption,
deduction, abatement or credit until:
(1) The individual or business becomes qualified under
this act.
(2) In the case of a business, receives certification
that the business is qualified for the exemption, deduction,
abatement or credit.
Section 2107. Repeals.
All acts and parts of acts are repealed insofar as they are
inconsistent with this act.
Section 2108. Effective date.
This act shall take effect immediately.
20210HB0600PN1053 - 40 -
1
2
3
4
5
6
7
8
9
10
11
12
13