Under the new changes to Act 47 that became law at the end of October one of the revenue options cities in distress could employ was to increase the rate of the Local Services Tax form its maximum rate of $52 per year to $156 a year with annual court approval. Scranton, as part of its 2015 budget proposal, appears ready to take that step, along with increases to its property tax.
Some might remember that Pittsburgh—which is in Act 47 status—was pre-empted from the LST option by virtue of the legislation.
If the court approves the plan by Scranton, the City would be prohibited from increasing its wage tax while in Act 47. The revenue from the LST has to be used for specific services, including emergency (police, fire, emergency medical) services.
