Friday, January 6, 2017

CURMUDGUCATION: PA: The Property Tax Problem

CURMUDGUCATION: PA: The Property Tax Problem:

PA: The Property Tax Problem

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AP's Marc Levy reports this week that Pennsylvania's legislature (one of the largest and most expensive ones in the country) is expected this year to once again tackle one of the great third rails of Pennsylvania politics-- property taxes.

This system is part of the mechanism that gives Pennsylvania one of the country's largest funding gaps between rich and poor districts. The state provides around 36.1% of public school funding, putting it around 45th in the nation. That means that local districts depend heavily upon local funding, and that's where the huge inequality slinks in. On the bottom end of the scale we find districts collecting $3,100 in local property tax dollars per student, while on the top end, the figure is around $13,000. Attempts were made in 2016 to fix things, a bit, but Democratic Governor Tom Wolf and the hugely GOP legislature have, well, some issues to sort out.

Levy writes that sponsors are expected to once again introduce House and Senate Bills 76, a bill that died a narrow death in the State Senate back in 2015 (a not-along-party-lines tie was broken by Democratic Lt. Governor Mike Stack), but the GOP thinks the math has changed and this year will be different (that's just the Senate, though-- this could all still tank in the House).

The goal, as usual, is to get rid of property taxes entirely. In this case, the plan is to replace them with increased sales tax and income tax revenue. Income tax would climb from 3.07% up to 4.95 %, while sales tax would jump from the already-hefty 6% to 7%-- and extended to more types of items and services that are not currently taxed at all.

The Property Tax Independence Act has plenty of fans and detractors, because it creates a whole 
CURMUDGUCATION: PA: The Property Tax Problem:

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