Wednesday, April 11, 2007
Act 1 to Test Voters Knowledge
Next month the voters in Pennsylvania (except for those in Philadelphia, Pittsburgh, and Scranton) will decide if they want to place more of a tax burden on their income as a tradeoff for lower school taxes. They will do this under the auspices of Act 1 of 2006.
The Pennsylvania School Board Association (PSBA) has released a preliminary survey on the status of the ballot questions. In plain language, the choices are “all over the place”. First, districts are choosing whether they want to either increase their earned income tax or eliminate the earned income tax and replace it with a personal income tax (the latter having a broader base including interest and dividends). Then, depending on the tax and its rate, an estimate of how much of a property tax reduction is produced.
Obviously, the question of “to pass or not to pass” comes down to what the taxpayer will pay under a higher tax on income and how much they plan to get back on their school taxes.
Statewide, 461 of the 498 eligible districts responded to the PSBA survey. The overwhelming majority (409 or 88%) are going the route of a higher earned income tax. Only 52 are opting for eliminating the earned income tax in favor of a personal income tax.
In Allegheny County the 42 eligible districts (all of which are currently levying an earned income tax of 0.5%) are split this way: 34, or 81 percent for a higher earned income tax, 8 or 19 percent for a personal income tax. Half of those districts going for an increase in the earned income tax are proposing a 1 percentage point hike to 1.5 percent. If all the referenda questions pass, tax relief will range from a low of $115 in Duquesne to $1,014 in Upper St. Clair.
Here’s the opinion of the PSBA study: “if all the ballot questions pass, the complexity of local tax collection will increase significantly”. Their prediction is for about 20 percent of the referenda to pass statewide, which, coincidentally, is roughly the same percentage of school districts that opted into the original voluntary tax relief and spending control proposal created by the state a few years ago.
The Pennsylvania School Board Association (PSBA) has released a preliminary survey on the status of the ballot questions. In plain language, the choices are “all over the place”. First, districts are choosing whether they want to either increase their earned income tax or eliminate the earned income tax and replace it with a personal income tax (the latter having a broader base including interest and dividends). Then, depending on the tax and its rate, an estimate of how much of a property tax reduction is produced.
Obviously, the question of “to pass or not to pass” comes down to what the taxpayer will pay under a higher tax on income and how much they plan to get back on their school taxes.
Statewide, 461 of the 498 eligible districts responded to the PSBA survey. The overwhelming majority (409 or 88%) are going the route of a higher earned income tax. Only 52 are opting for eliminating the earned income tax in favor of a personal income tax.
In Allegheny County the 42 eligible districts (all of which are currently levying an earned income tax of 0.5%) are split this way: 34, or 81 percent for a higher earned income tax, 8 or 19 percent for a personal income tax. Half of those districts going for an increase in the earned income tax are proposing a 1 percentage point hike to 1.5 percent. If all the referenda questions pass, tax relief will range from a low of $115 in Duquesne to $1,014 in Upper St. Clair.
Here’s the opinion of the PSBA study: “if all the ballot questions pass, the complexity of local tax collection will increase significantly”. Their prediction is for about 20 percent of the referenda to pass statewide, which, coincidentally, is roughly the same percentage of school districts that opted into the original voluntary tax relief and spending control proposal created by the state a few years ago.
