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Since 2003, with the arrival of
a new Democrat governor determined to begin rolling back eight years of tax cuts
enacted by Republicans, Senate Republicans have been fighting for taxpayers.
After a
lengthy budget debate, Senate Republicans won approval of a 2003-04 state budget
that slashed Gov. Rendell's proposed Personal Income Tax increase by two-thirds,
making it less onerous for businesses and individual taxpayers. For the next
four years Senate Republicans held the line on taxes, boosting the Rainy Day
Fund in 2006-07 and
rejecting all seven of the governor's proposed tax hikes
for 2007-08.
This year, Senate Republicans
continue to work to
control state spending and will
carefully examine the major spending and borrowing provisions proposed in
Governor Rendell's 2008-2009 state budget, particularly with concerns looming
about a slowing economy. |
| Senate
Acts to Overhaul EMS Tax, End $52 Paycheck Hit |
The Senate approved significant reforms to the Emergency and
Municipal Services Tax, with legislation that has been
signed into law.
The Senate concurred with House amendments to
Senate Bill 218 (now Act 7 of 2007), sponsored by Senate
Finance Committee Chairman Pat Browne (R-Lehigh).
The new law ends the lump-sum maximum payment of $52
and set specific restrictions on how taxing entities may use
revenues raised by the levy. It also requires that the tax
be withheld on a payroll-period basis with a maximum
deduction of $1 per week. Employers will be
required to send collections on a quarterly basis. Those
earning $12,000 or less per year are exempted
from paying the tax.
Senate Bill 218 renames the tax as the more accurate “Local
Services Tax” and requires that a minimum of 25 percent of
the total revenue collected must go to support emergency
services including police, fire and emergency medical
services operations. The remaining revenues could be used
for road construction and maintenance, and property tax
relief.
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Taxpayer Protection Act
Spending Limits Move Forward |
The Senate Finance Committee, chaired by Sen. Pat Browne
(R-Lehigh), approved the
Taxpayer
Protection Act bill and Constitutional Amendment,
designed to rein in state government spending.
Senate Bill 7, sponsored by Sen. Bob Regola
(R-Westmoreland), is a proposed amendment to the
Pennsylvania State Constitution that would limit state
spending to the average inflation rate plus the
average percentage change in state population over the three
preceding years.
Senate Bill 707, sponsored by Sen. Mike Folmer
(R-Lebanon), would provide the same limitation, but not as a
Constitutional Amendment.
To prevent the state from pushing spending
requirements onto local taxpayers, the measures were
amended to include a provision by Sen. John Eichelberger
(R-Blair) stating that the spending limit would be decreased
when funds are cut to a mandated service.
In addition to the spending limits in the Taxpayer
Protection Act, the proposal also sets realistic
restrictions on the use of any unanticipated revenues
received by the Commonwealth. Specifically, 75 percent of
any revenues exceeding the spending limits imposed by the
bill would be returned to taxpayers. The remaining 25
percent would go directly into the Rainy Day Fund to help
address unanticipated revenue shortfalls.
| Joint Hearing
Focuses on Legality of Governor's New Tax on Employers |
The Senate Banking
and Insurance Committee, chaired by Sen. Don White (R-Indiana), and the Senate
Finance Committee, chaired by Sen. Pat Browne (R-Lehigh), held a
joint public hearing on the legality and practicality of Gov. Rendell's
proposed tax on employers to support his health care plan.
The committees heard
testimony from a national expert, who said a recent court decision involving a
mandated health benefits program in Maryland means "an act of Congress" would be
needed before Gov. Rendell's proposal could be enacted. In January 2007, the
U.S. Court of Appeals for the Fourth Circuit affirmed a decision that
invalidated Maryland's program citing that it clashed with the Employee
Retirement Income Security Act of 1974.
Todd Anderson,
Outside General Counsel for Retail Industry Leaders Association, said the Fourth
Circuit Court's decision would directly apply to Governor Rendell's tax
proposal.
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2010 Budget Hearings Highlights and Summaries
Senators Pileggi, Mellow Name Members to Cost Study
Commission; First Meeting on Feb. 19
Senator Majority Leader Dominic Pileggi (R-9) and Senate Democratic Leader
Robert Mellow (D-22) announced the names of members appointed to the Government
Management and Cost Study Commission created by
Senate Resolution 161.
Amended Municipal Pension Bill Protects Workers, Taxpayers
In 1984, Pennsylvania enacted Act 205, which is appropriately
and most clearly summarized in its name "The Municipal Pension Plan Funding
Standards Act." The reason for this effort was to ensure that pension systems
across Pennsylvania maintained fiscal stability to protect municipal employees
in their personal financial security and the public that they serve.
Senate Approves Municipal Pension Relief Measure
The Senate approved legislation designed to aid Pennsylvania's ailing
municipal pension plans, according to Senator Pat Browne (R-16), author of an
amendment that expanded the bill to include communities across the Commonwealth.
Finance Committee Approves Municipal Pension Relief Measure
The Senate Finance Committee amended and approved legislation designed to
help Philadelphia address its fiscal crisis and provide relief from spiking
public pension liabilities to communities across the Commonwealth, according to
Committee Chairman Senator Pat Browne (R-16).
 
- Hearing
- Senator Browne
- Senator Orie
Finance Committee Approves Surviving Spouse Tax Bill
The Senate Finance Committee approved legislation that will
allow a surviving spouse to file a joint state income tax return, according to
Committee Chairman Senator Pat Browne (R-16).
Eichelberger To Introduce Alternative
County-Wide Tax Reform Plan
Senator John H. Eichelberger, Jr. (R-Blair) announced his intention to
introduce an alternative to the local sales tax plan proposed by the Governor.
Under his proposed "Balanced Options-Local Decisions" Act, the voters could also
select a new local tax structure which could include a sales or income tax at
the county level.

Pippy Chairs Meeting on Impact of Tax-Exempt
Property on Municipalities
Harrisburg – The
Legislative Budget and Finance Committee, chaired by Sen. John Pippy (R-37),
gathered experts to discuss the impact tax-exempt properties have on
the fiscal status of Pennsylvania municipalities.
Argall Advocates Property Tax Referendum
HARRISBURG – State
Senator David G. Argall (R-29) announced a measure that would give
Pennsylvania voters a stronger voice in the elimination of the state's outdated
school property tax system.
Finance Committee OKs Expanded Check-Off Box
Option
The Senate Finance Committee approved
legislation allowing charitable contributions to be added to income tax
remittance payments, according to Committee Chairman Senator Pat Browne (R-16).
Senate Approves Transfer of Funds to Ease
Budget Deficit
The state Senate approved legislation sponsored
by Sen. Mary Jo White (R-21) to transfer much-needed revenue into the state's
General Fund budget, helping to close a budget deficit without increasing taxes
on working Pennsylvanians.
Senate Republican Leaders Seek to Set Core
Guidelines For Determining How Federal Stimulus Funds are Spent
Senate Republican
leaders announced their sponsorship of a resolution outlining core principles
that the Senate will follow when determining how federal stimulus money will be
spent in Pennsylvania.
Senator Brubaker Introduces Stimulus Oversight
Legislation
Senator Mike Brubaker
(R-36) introduced legislation that would provide transparency and
oversight of all federal stimulus dollars spent in Pennsylvania.
Committee Approves Taxpayer Transparency Act
The Senate Finance Committee approved the Taxpayer
Transparency Act bill and a resolution calling for a study of
the impact of state business tax credit programs on
Pennsylvania’s economy, job market and local tax revenues,
according to Committee Chairman Senator Pat Browne (R-16).
Vance Proposes Legislation to Place Moratorium
on Film Tax Credit Program
In the face of the
Commonwealth's current fiscal woes, Sen. Pat Vance (R-Cumberland/York) has
introduced legislation to suspend Pennsylvania's $75 million Film Production Tax
Credit program.
Scarnati Legislation Would Return Funds from
Legislative Accounts
Senate President Pro
Tempore Joe Scarnati (R-Jefferson) is preparing to introduce legislation that
would transfer a significant portion of surplus funds from legislative accounts
to the General Fund.
Alloway Introduces Legislation to Phase Out
'Death Tax'
Senator Richard
Alloway II (R-33) introduced legislation that would completely phase out
Pennsylvania's inheritance tax by 2017.
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