HARRISBURG—The dreaded school property tax bill hits homeowners in Pennsylvania hard each and every year. That tax accounts for over 60 percent of school funding. Now there are some pushes to change the funding structure.
It is a drastic change. Two plans are currently being discussed, one calling for the elimination of school property taxes altogether. The idea would lessen the burden on homeowners, especially the elderly on a fixed income, and more evenly distribute the tax liability.
It's the dream of so many homeowners in Pennsylvania to eliminate school property taxes. Under a new bill proposed in the House, that dream could become a reality. House Bill 1776 will get a second round of hearings today at the Capitol.
"It will give us some more input so we can make this a better bill," said Representative Jim Cox, (R) Berks County.
The Property Tax Independence Act, written by Representative Cox, calls for the elimination of the fee homeowners pay on the value of their house and land. Those property taxes would be replaced by a hike in other taxes like income and state sales tax.
"I am not married to the ins and outs of all of the particulars of the bill. What I am married to is the concept of full replacement of our school property taxes with a broader based more fair tax," Cox said.
Representative Cox believes that homeowners should not be the only ones burdened with paying for schools. To spread the pain, the plan calls for an increase in the personal income tax from just over 3 percent to 4 percent and an increase in the sales tax from 6 to 7 percent. Along with the increases, most of the state`s exemptions would also go away. Even if this plan isn't enacted completely, Representative Cox says change is needed.
"If we come up with another tax, if we come up with another way to do things and it still fully replaces the school property tax, then that's what we have to do and that is what I will do to get it done," he said.
Some groups say House Bill 1776 simply shifts around the tax burden. Many believe the bill would help seniors and businesses who would pay less while low-income or non-homeowners could pay more.
That hearing is set to start this morning at 9:30 a.m. Another bill in the works by York County Representative Seth Grove also calls for a drastic change to the tax structure. His plan would not eliminate property taxes all together but lessen them with a rise in some county taxes. That was passed by the House Finance Committee and now awaits a full-floor vote.