America's Property Tax Advisor

Déjà Vu - Pennsylvania Bill Seeks to Eliminate School Property Taxes

BY TOM BRANHAM, WASHINGTON D.C., MARCH 2022

Pennsylvania legislators are once again considering doing away with property taxes to fund public education. House Bill 13 is a revised version of a bill submitted three years ago that failed to pass.

 

To generate the $16 billion needed to replace property taxes, the plan includes new taxes on certain retirement income, food, and clothing .

 

Looking Toward the Future

 

Pennsylvania school property taxes are forecast to double in 17 years and triple in 30 years, HB 13 sponsor Rep. Frank Ryan told a Capitol news conference.

 

“Everybody wants to get rid of property taxes as long as the other person is the one who is going to pay the replacement tax,” Ryan said. “It is clear that any solution will require sacrifice on the part of all Pennsylvanians.”

 

Tax Swap

 

HB 13 calls for:

 

  • Increasing the state’s 3.07% personal income tax by 1.85%

  • Applying the 4.92% income tax to certain types of retirement income

  • Raising the sales tax 2% on clothing and food, not including WIC/SNAP purchases

 

The bill also requires landlords to reduce rent by the amount of property tax they save for the duration of the current lease.

 

It removes the caps on how much school districts can keep in their rainy-day fund to help them better manage their budgets. And it would create a $500 million emergency fund for school districts to tap into if they can’t balance their budget and need to undergo financial restructuring.