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Counties pressing Legislature for sales tax hike to 7 percent
Tuesday, June 23, 2009

With the budget deadline looming next Tuesday, county commissioners from across Pennsylvania made a last minute plea yesterday to lawmakers for permission to raise sales taxes in their counties by 1 percentage point.

Since the Senate Republicans revealed their budget plan, which made deep cuts to local government, local officials have aired concerns that limited state funding could force them to raise their property taxes.

Despite the Senate budget's defeat by the House Appropriations Committee, commissioners are pushing a bill introduced by Rep. Michael Sturla, D-Lancaster, which would allow individual counties to levy an additional 1 percent sales tax. Counties must use 60 percent of the proceeds from the tax for lowering real estate taxes.

The sales tax is 6 percent in 65 of Pennsylvania's 67 counties.

Philadelphia and Allegheny County, which are both excluded from Sturla's plan, already have raised their sales tax to 7 percent.

Earlier this year, the Rendell administration estimated that allowing counties to raise the sales tax to 7 percent could generate about $1.25 billion annually -- a figure that's increasingly attractive considering the state's $3.2 billion deficit.

"The governor believes that counties should have the option of raising their sales tax by 1 percent if they deem it necessary," said Rendell spokesman Chuck Ardo. "Unfortunately, every level of government is facing fiscal challenges and is looking for new revenue streams in the midst of this recession."

Joyce Somers, mayor of Murrysville, said she's "sick and tired" of having to raise her municipality's real estate tax. Yesterday was Ms. Somers' third time in Harrisburg this year arguing for the optional county sales tax.

"I think that a lot of communities are in trouble right now with a lot of their pension plans having gone south," Ms. Somers said. "This won't impact people as much at lower income levels."

If Westmoreland County could increase the sales tax by 1 percent, Ms. Somers said, her municipality would rely less on the property tax.

With the governor's recent proposal to hike the income tax rate from 3.07 percent to 3.57, Steve Miskin said counties should re-evaluate the necessity of services and programs before trying to put more pressure on citizens through taxes.

"Pennsylvanians are making choices when they go to the grocery stores about what they can afford and what they can't," Mr. Miskin. "We generally do not feel that increased taxes should be an option that they have to deal with."

Butler County Commissioner Jim Kennedy, president of the County Commissioners Association of Pennsylvania, said a sales tax hike is the lesser of two evils.

If the legislation is passed, Mr. Kennedy said, he's hoping Butler County's 21-mill property tax could be reduced by three to five mills.

"Taxes are always reasons to be upset," Mr. Kennedy said. "I'm always upset whenever I get a tax. But which is worse? This happens to be an option that is feasible because it doesn't affect the property owner."

Lauren Boyer is an intern with the Pennsylvania Legislative Correspondents' Association.
First published on June 23, 2009 at 12:00 am
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