HARRISBURG -- A state Senate panel, desperate to get public attention off the Legislature's much-criticized pay raises, approved a bill yesterday that would ask voters whether they want to increase the state sales and income taxes in order to reduce property taxes.

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The special panel, part of the ongoing special General Assembly session on property tax relief, approved the Republican-sponsored plan for what proponents call a major "tax shift."

If approved by voters in a statewide referendum March 14, the plan would increase the state sales tax by 1 percentage point -- to 7 percent statewide and 8 percent in Allegheny and Philadelphia counties -- and the personal income tax by 0.43 percentage points, to 3.5 percent. The additional money would be used to lower property taxes for homeowners and expand a rent rebate program for senior citizens.

The legislation, which could be voted on by the full Senate as early as Monday, projects that the tax shift would generate an additional $2.6 billion.

Under the Republican-backed plan, $1.8 billion of that amount would be given to the state's 501 school districts to reduce property taxes for homeowners on a dollar-for-dollar basis.

The remaining $800 million would go to expand existing property tax freeze and rent rebate programs for senior citizens.

Gov. Ed Rendell has been urging legislators for several weeks to "get the pay raise behind us" and move on to other "more important" issues, such as property tax reductions and minimum wage increases.

During an appearance in Pittsburgh last night, Mr. Rendell said he would consider the Republican proposal.

"I said I'm open to all these ideas and I would consider anything, take a look at anything. If you recall my original plan when I ran [for governor] in 2002 was to use the gaming revenue and a small increase in the [personal income tax] to reduce property taxes by 30 to 32 percent. So obviously having said that that was my original plan, I wouldn't necessarily be averse to that."

Mr. Rendell also said that while he is skeptical of the referendum process, he would consider it in this case.

"I would consider that since it's tax shifting," Mr. Rendell said. "It might be wise to see what people think of it."

The General Assembly began a special session on property tax relief in late September, but until yesterday, hadn't done anything substantive on the subject.

Yesterday, just half an hour after giving final approval to repealing the pay raises, a special Senate property tax panel approved the tax shifting plan sponsored by Majority Leader David Brightbill, R-Lebanon.

If approved by the full Senate Monday, the bill would move on to the House, also controlled by Republicans. If approved there, it would go to Mr. Rendell, a Democrat.

Senate Republican legal counsel Stephen MacNett said the goal is to get the GOP tax plan approved by the end of the year, in order to allow plenty of time to educate voters before the March 14 referendum. It would precede the regular primary election scheduled for May 17, when the full House and half of the Senate are up for election.

Mr. Rendell, along with virtually all legislators, wants public outrage over the unpopular pay raises to fade before they have to run for re-election.

Democrats on the special Senate committee, such as Robert Mellow of Scranton, complained that the GOP was moving too fast on the plan, which he said would significantly change taxes in the state.

"This is a tax increase of over $2 billion and we need time to study this," Mr. Mellow said.

Mr. Brightbill denied it was an increase, calling it just a shift. He said people in his district are crying for property tax relief and this is the fastest way to do it. Nothing would happen if statewide voters don't approve the plan, he noted.

Sen. Michael O'Pake, D-Berks, questioned if the bill is legal or constitutional, saying it's the Legislature's job to set tax rates.

Mr. Brightbill said that nonbinding referendums aren't legal in Pennsylvania, but binding resolutions are. There was a binding statewide referendum on taxes under Gov. Robert P. Casey in 1989, he noted, in which changes to the state tax system were rejected.

Republicans won approval of the Brightbill bill on a 14-10 vote, with nine Democrats and one Republican, Sen. Jake Corman of Centre County, opposed.

Mr. Rendell's press secretary, Kate Philips, said the administration would study the Republican idea, but that it was too soon to say if the governor would sign the bill for a statewide voter tax referendum.

Mr. Rendell has been pushing his own plan for property tax relief. He wants to use up to $1 billion in new revenue from 14 slot machine casinos to provide an average property tax reduction of $300 per homeowner statewide.

It isn't known yet exactly how much tax relief homeowners in each school district would get under the Brightbill plan.

But the bill says the money would be allocated to a school district by multiplying $1,000 times the number of students in the district as of the 2004-05 school year.