Pennsylvania considers eliminating school property taxes to make housing more affordable

[donnay]

Pennsylvania considers eliminating school property taxes to make housing more affordable

Saturday, March 23, 2013 by: Ethan A. Huff (http://www.naturalnews.com/039607_Pennsylvania_property_taxes_housing.html), staff writer

Legislators in Pennsylvania are considering a new proposal that would do away with the state's property tax scheme that currently funds government-run public schools, and replace it with slight tax increases on both sales and state income. According to the bill's advocates, property owners would benefit greatly from the change, while the two tax increases would represent a mere penny-or-so increase for every one dollar spent or earned, respectively.

Known as the Property Tax Independence Act, or House Bill 76, the bill was recently unveiled by a cohort of both Democrats and Republicans who say it is pertinent and in the best interests of Pennsylvanians to finally establish true home ownership throughout the state. After conducting a thorough analysis of the proposal during the previous legislative session, the Independent Fiscal Office determined that, financially speaking, the change would allow schools to still receive the same amount of funding, but would protect homeowners from the unfair, antiquated property tax.

"This legislation offers hope to Pennsylvania residents who aspire to truly own their homes," says Representative Jim Cox (R-129), who together with state Senator David G. Argall (R-29) unveiled the bill in early March. "Homeowners simply cannot understand how the General Assembly could continue to allow people to lose their homes through no fault of their own and drive citizens and businesses out of Pennsylvania."

Property taxes put true home ownership out of reach for many people, particularly those on fixed incomes

While Pennsylvania does not rank among the top 10 states with the highest property tax rate, the annual fee, which has been around for many years, is burdensome on millions of Pennsylvanians, many of whom are elderly and on fixed incomes. According to those advocating to eliminate property taxes, the levy is "outmoded, archaic, and unfair," to borrow the words of Sen. Argall.

As is commonly known, property taxes across the U.S. are perpetual, which means they are a permanent fixture of property ownership regardless of whether or not a property owner uses the public services funded by their collection. Property taxes are also generally calculated based on the assessed value of properties every year, which means they typically increase in conjunction with the rise of property values.

What this means is that individuals, families, and senior citizens on fixed incomes end up being forced to shell out many thousands of dollars every year to their local tax assessor-collector for property they already own, regardless of whether or not they use local public schools and other services funded by property taxes. Lawmakers across Pennsylvania say they continually hear from constituents who are outraged about this property tax scheme, which has resulted in many homeowners actually losing their homes.

"No tax should have the power to leave you homeless," said Rep. Cox last year during a previous unveiling of the bill. "We have to end the practice of kicking senior citizens and widows out of their homes because they cannot afford to pay their property taxes."

If H.B. 76 is passed, the state sales tax in Pennsylvania would increase from six to seven percent, which would result in a tax increase of about one penny per one dollar spent. Similarly, the state income tax would increase from 3.07 percent to 4.34 percent, resulting in about a 1.27 percent tax increase for every one dollar earned, according to reports.

Sources for this article include:

http://www.repjimcox.com/NewsItem.aspx?NewsID=16747

http://www.phillyburbs.com

http://cumberlink.com

Learn more: http://www.naturalnews.com/039607_Pennsylvania_property_taxes_housing.html#ix zz2ONNNFpEM

[brandon]

They are also about to kill the liquor cartel. Good times.

[BAllen]

Well, that's a step in the right direction. I'm just surprised it's from Pennsylvania. They're really heavy on regulations.

[kathy88]

I would support this. I pay 6k a year for both my properties. That's total, not sure what percentage is school of that. Ill have to check my tax bills. Our current state tax rate is 6 percent.

[juleswin]

I would support this. I pay 6k a year for both my properties. That's total, not sure what percentage is school of that. Ill have to check my tax bills. Our current state tax rate is 6 percent.

I wonder how many children one would need to have to make up for all the money paid in for property taxes assuming they own the house for at least 30 years. This must really suck for childless families.

[Hyperion]

They should do this without increasing sales or income taxes. Of course getting rid of the property tax is admirable.

I would strongly advocate getting rid of the income tax also.

[amy31416]

An end to the State Stores? Woah...

School tax was a very large portion of property taxes in PA--hope it passes.

[kathy88]

They should do this without increasing sales or income taxes. Of course getting rid of the property tax is admirable.

I would strongly advocate getting rid of the income tax also.
At this point Ill take anything that helps me keep a few more FRNs a month.

[Rothbardian Girl]

A beacon of hope for my home state... cool.

[Nirvikalpa]

I would support this. I pay 6k a year for both my properties. That's total, not sure what percentage is school of that. Ill have to check my tax bills. Our current state tax rate is 6 percent.

God I miss PA. :P

[kathy88]

God I miss PA.
We miss you TOO!!!!!

[amy31416]

IIRC, school tax was about $1,000 out of a total of $2,500 in property taxes. Broken into 3 parts: City, county, school. City was also around 1k, with county being about $500.

[Zippyjuan]

Sales taxes according to the proposal would go up a full percentage point (from six to seven pecent in some areas) and the list of taxable items would be greatly expanded as well. http://www.post-gazette.com/stories/local/state/proposed-legislation-would-end-property-tax-funding-for-schools-in-pa-637781/

Looks like income taxes could possibly rise as well. The sales tax hike alone would only take about one tenth of the money needed.



Many of his colleagues worry about the higher state income tax and state sales tax that the bill calls for. It also would extend the sales tax to many goods and services that have always been exempt -- even including taxing certain food and clothing purchases and nonprescription drugs.

Read more: http://www.post-gazette.com/stories/local/state/proposed-legislation-would-end-property-tax-funding-for-schools-in-pa-637781/#ixzz2OOP5eTym


But to eliminate school property taxes around the state, the Legislature must come up with a huge amount -- an estimated $10 billion -- in replacement revenue. Mr. Cox has three ideas:

• Raising the state income tax rate, now at 3.07 percent, to about 4 percent. That would bring in an extra $3.5 billion, he estimated.

• Raising the sales tax rate, now 6 percent in most counties, to 7 percent (and to 8 percent in Allegheny County, which is already at 7 percent due to the Regional Asset District tax.) That will generate an additional $1.5 billion.

• Eliminating the sales-tax exemption on many goods and services that are now not taxed, producing $4.6 billion.

The rest of the needed $10 billion would come from an existing tax on slot machine revenues, created when casinos were legalized in 2004.

Under the proposed 7 percent sales tax rate, clothing and shoe purchases over $50 would be taxable, as would purchases of food and grocery items that aren't contained on the WIC list -- healthy, nutritional foods on a list called Women, Infants and Children, compiled by the federal government.

For example, Mr. Cox said, sugary cereals would be taxable, but healthier cereals that have no sugar coating would not be.

Items and services that would become taxable under the bill include dry cleaning, funeral expenses, amusement parks, flags, gum, newspapers, magazines and candy.


Read more: http://www.post-gazette.com/stories/local/state/proposed-legislation-would-end-property-tax-funding-for-schools-in-pa-637781/#ixzz2OOOtro2Z

[dillo]

They are also about to kill the liquor cartel. Good times.

that will never happen

[parocks]

Pennsylvania considers eliminating school property taxes to make housing more affordable

Saturday, March 23, 2013 by: Ethan A. Huff (http://www.naturalnews.com/039607_Pennsylvania_property_taxes_housing.html), staff writer

Legislators in Pennsylvania are considering a new proposal that would do away with the state's property tax scheme that currently funds government-run public schools, and replace it with slight tax increases on both sales and state income. According to the bill's advocates, property owners would benefit greatly from the change, while the two tax increases would represent a mere penny-or-so increase for every one dollar spent or earned, respectively.

Known as the Property Tax Independence Act, or House Bill 76, the bill was recently unveiled by a cohort of both Democrats and Republicans who say it is pertinent and in the best interests of Pennsylvanians to finally establish true home ownership throughout the state. After conducting a thorough analysis of the proposal during the previous legislative session, the Independent Fiscal Office determined that, financially speaking, the change would allow schools to still receive the same amount of funding, but would protect homeowners from the unfair, antiquated property tax.

"This legislation offers hope to Pennsylvania residents who aspire to truly own their homes," says Representative Jim Cox (R-129), who together with state Senator David G. Argall (R-29) unveiled the bill in early March. "Homeowners simply cannot understand how the General Assembly could continue to allow people to lose their homes through no fault of their own and drive citizens and businesses out of Pennsylvania."

Property taxes put true home ownership out of reach for many people, particularly those on fixed incomes

While Pennsylvania does not rank among the top 10 states with the highest property tax rate, the annual fee, which has been around for many years, is burdensome on millions of Pennsylvanians, many of whom are elderly and on fixed incomes. According to those advocating to eliminate property taxes, the levy is "outmoded, archaic, and unfair," to borrow the words of Sen. Argall.

As is commonly known, property taxes across the U.S. are perpetual, which means they are a permanent fixture of property ownership regardless of whether or not a property owner uses the public services funded by their collection. Property taxes are also generally calculated based on the assessed value of properties every year, which means they typically increase in conjunction with the rise of property values.

What this means is that individuals, families, and senior citizens on fixed incomes end up being forced to shell out many thousands of dollars every year to their local tax assessor-collector for property they already own, regardless of whether or not they use local public schools and other services funded by property taxes. Lawmakers across Pennsylvania say they continually hear from constituents who are outraged about this property tax scheme, which has resulted in many homeowners actually losing their homes.

"No tax should have the power to leave you homeless," said Rep. Cox last year during a previous unveiling of the bill. "We have to end the practice of kicking senior citizens and widows out of their homes because they cannot afford to pay their property taxes."

If H.B. 76 is passed, the state sales tax in Pennsylvania would increase from six to seven percent, which would result in a tax increase of about one penny per one dollar spent. Similarly, the state income tax would increase from 3.07 percent to 4.34 percent, resulting in about a 1.27 percent tax increase for every one dollar earned, according to reports.

Sources for this article include:

http://www.repjimcox.com/NewsItem.aspx?NewsID=16747

http://www.phillyburbs.com

http://cumberlink.com

Learn more: http://www.naturalnews.com/039607_Pennsylvania_property_taxes_housing.html#ix zz2ONNNFpEM

So, fewer sales, fewer jobs, more property ownership.

Pennsylvania wants more old people, retirees, who don't need jobs, and fewer young people who need jobs. It is awful though that you have to pay to just "be", with the property tax.

[amy31416]

Sales taxes according to the proposal would go up a full percentage point (from six to seven pecent in some areas) and the list of taxable items would be greatly expanded as well. http://www.post-gazette.com/stories/local/state/proposed-legislation-would-end-property-tax-funding-for-schools-in-pa-637781/

Looks like income taxes could possibly rise as well. The sales tax hike alone would only take about one tenth of the money needed.

Increasing and expanding sales tax would be absolutely foolish. People came from Canada, Ohio, NY, MD just to shop for tax-free clothing.

[Anti Federalist]

Sales taxes according to the proposal would go up a full percentage point (from six to seven pecent in some areas) and the list of taxable items would be greatly expanded as well. http://www.post-gazette.com/stories/local/state/proposed-legislation-would-end-property-tax-funding-for-schools-in-pa-637781/

Looks like income taxes could possibly rise as well. The sales tax hike alone would only take about one tenth of the money needed.

Don't you get tired of carrying around all those wet blankets everywhere you go?

I thought I was bad...sheesh.

:p

[Anti Federalist]

Income and property taxes are the two most immoral taxes there are.

With the former, you never truly own the fruits of your labor.

The latter, you never truly own your property.

Both turn you into a vassal.

I hope the sales tax does go through the roof, let the Mundanes see exactly how much the government they love and worship so much actually costs.

[parocks]

Increasing and expanding sales tax would be absolutely foolish. People came from Canada, Ohio, NY, MD just to shop for tax-free clothing.

Right on.

Taxes punish, discourage. You make something more expensive, you get less of it. And that's a pretty hefty income tax hike, too. Do employers want their employees paying more taxes? Perhaps they'll shop around for a better deal.

Old people don't have jobs. If PA raises the income tax enough, and lowers the property tax enough, people will buy second homes in PA. People who live in PA won't be able to afford the nice houses, because the jobs were driven out by the income taxes.

That's Maine for you. I'd recommend lowering the income taxes to increase economic activity, and raise property taxes. In Maine, the people with the expensive houses on the water didn't make the money to buy those houses in Maine. In some cases those nice houses are 2nd homes, owned by people who work elsewhere and live in Maine less than 6 months a year (avoiding the high income taxes), or retirees who worked elsewhere.

Having lived in both, they're quite different places. Maine is the oldest state. And Pennsylvania is close to the top already.

[Zippyjuan]

Maine is the oldest state.

Delaware is considered the first state (based on order the first 13 ratified the Constitiution). Maine was not one of the original 13 colonies and is listed as 23rd state to join the Union- joining in 1820. Pennsylvania is #2.
http://en.wikipedia.org/wiki/List_of_U.S._states_by_date_of_statehood

[kahless]

I would feel better if it was Constitutional amendment to bar the levying of any form of property tax. Otherwise one could move there and find themselves down the road paying property taxes when they get voted back in again.

It also is unclear from the overview if other property taxes will be eliminated.

[parocks]

Delaware is considered the first state (based on order the first 13 ratified the Constitiution). Maine was not one of the original 13 colonies and is listed as 23rd state to join the Union- joining in 1820. Pennsylvania is #2.
http://en.wikipedia.org/wiki/List_of_U.S._states_by_date_of_statehood

Right, I'm talking the age of the people who currently live there. Median age.

[Zippyjuan]

Sorry I misunderstood. http://money.cnn.com/2011/05/26/real_estate/americas_oldest_states/index.htm

Maine's median age in 2010 was 42.7, the Census reported Thursday. That's two years older than the median in Florida, and more than five years above the national median age of 37.2.

"This has been going on for years," said Jim Breece, an economist at the University of Maine. "The biggest factors are the low birth rate here and the out-migration of young families looking for opportunities."

Breece added that the state tends to retain its older residents and has attracted quite a few new retirees from out of state. Some towns are catering to this demographic, building new retirement communities and offering events like concerts and lectures to enrich retirements. ('25 best places to retire')

The nation as a whole grew nearly two years older since the last Census count in 2000, when the median age was 35.3. In 1990, it was just 32.7.

The second oldest state is Vermont, with a median age of 41.5. West Virginia's median is 41.3 and New Hampshire's is 41.1. Seven states have a median age of more than 40 years.

Florida did have the highest percentage of senior citizens -- residents aged 65 or older -- at 17.3%. That was well above the national median of 13%. At 16%, West Virginia has the second highest percentage of senior citizens

[Anti Federalist]

"This has been going on for years," said Jim Breece, an economist at the University of Maine. "The biggest factors are the low birth rate here and the out-migration of young families looking for opportunities."

Maine is going to end up nothing more than a giant Martha's Vineyard, populated only by the following:

An elite leisure class, from Mass. and NY and CT mostly, and a poverty stricken servant class, scratching out a seasonal living catering to the leisure class.

It will be impossible for a middle class family to survive there.

[DaninPA]

They've been yapping about this for years. Same with the liquor sales privatization. I'll believe it when I see it.

Taxes from casinos were going to "greatly" reduce property taxes too.

But hey, those legislators get a really nice pension don't they?