[Adopted 12-26-2007 by Ord. No. 2007-375[1]]
[1]
Editor's Note: This ordinance also repealed
former Art. III, Emergency and Municipal Services Tax, adopted 1-2-2007
by Ord. No. 2007-367.
This ordinance shall be known and may be cited
as the "Palmer Township Local Services Tax Ordinance."
This ordinance is enacted under the authority
of the Local Tax Enabling Act,[1] as amended by Act No. 7 of 2007.
[1]
Editor's Note: See 53 P.S. § 6924.101
et seq.
The purpose of this ordinance is to provide
revenue for police, fire and emergency services; road construction
and maintenance; the reduction of property taxes; and for such other
purposes as may be specified for such tax from time to time by the
laws of the Commonwealth of Pennsylvania.
The following words and phrases, when used in
this ordinance, shall have the meanings ascribed to them in this section,
except where the context clearly indicates or requires a different
meaning:
The governing body of the Township of Palmer.
The person or firm from time to time designated by motion
of the governing body of Palmer Township to collect and administer
the provisions of this ordinance and collect the tax levied by this
ordinance. Until changed by subsequent motion, the collector shall
be the same person or firm last designated to collect the emergency
and municipal services tax for Palmer Township.
Compensation, as determined under Section 303 of the Act
of March 4, 1971 (P.L. 6, No. 2), known as the "Tax Reform Code of
1971,"[1] and regulations in 61 Pa. Code Part I, Subpart B, Article V[2] (relating to personal income tax), not including, however, wages or compensation paid to individuals on active military service. Employee business expenses are allowable deductions as determined under Article III of the Tax Reform Code of 1971.[3] Any housing allowance provided to a member of the clergy
shall not be taxable as earned income.
An individual, partnership, association, corporation, governmental
body, agency or other entity employing one or more persons on a salary,
wage, commission, fee or other compensation basis, including a sell-employed
person.
Shall include singular and plural number, and male, female
and neuter genders.
Any person engaged in any occupation, trade or profession
within the jurisdictional limits of Palmer Township whose total earned
income and net profits within Palmer Township are $12,000 or greater
per calendar year.
The net income from the operation of a business, profession
or other activity (except from corporations), determined under Section
303 of the Act of March 4, 1971 (P.L. 6, No. 2), known as the "Tax
Reform Code of 1971,"[4] and regulations in 61 Pa. Code Part I, Subpart B, Article V[5] (relating to personal income tax). The term does not include
income which is not paid for services provided and which is in the
nature of earnings from an investment. For taxpayers engaged in the
business, profession or activity of farming the term shall not include:
Any interest generated from monetary accounts
or investment instruments of the farming business;
Any gain on the sale of farming machinery;
Any gain on the sale of livestock held 12 months
or more for draft, breeding or dairy purposes; and
Any gain on the sale of other capital assets
of the farm.
Any trade, profession, business or undertaking of any type,
kind or character, including services, domestic or other, carried
on or performed within the jurisdictional limits of Palmer Township
for which compensation is charged and/or received, whether by salary,
wages, commissions, fees or net profits for services rendered.
The United States Army Reserve, United States Navy Reserve,
United States Marine Corps Reserve, United States Coast Guard Reserve,
United States Air Force Reserve, the Pennsylvania Army National Guard
or the Pennsylvania Air National Guard.
The local services tax levied in this ordinance.
A calendar year.
Palmer Township hereby levies and imposes on
every individual engaging in an occupation within the jurisdictional
limits of Palmer Township a tax in the amount of $52 per annum, beginning
the first day of January 2008, and continuing on a calendar basis
annually thereafter, until modified or repealed by subsequent ordinance.
This tax is in addition to all other taxes of any kind or nature heretofore
levied by Palmer Township.
A.
B.
Palmer Township shall use no less than 25% of the
funds derived from the local services tax for emergency services.
A.
Each employer within Palmer Township, and each employer
situated outside Palmer Township who engages in business within Palmer
Township, is hereby charged with the duty of collecting the tax from
each of the employees engaged by the employer and performing work
for the employer within Palmer Township. Each person subject to the
tax shall be assessed a pro rata share of the tax for each payroll
period in which the person is engaging in an occupation.
B.
The pro rata share of the tax assessed on the person
for a payroll period shall be determined by dividing the combined
rate of the local services tax levied for the calendar year by the
number of payroll periods established by the employer for the calendar
year. For purposes of determining the pro rata share, an employer
shall round down the amount of the tax collected each payroll period
to the nearest 1/100 of a dollar.
C.
Employer collections of the local services tax shall
be made on a payroll-period basis for each payroll period, beginning
with the first payroll period in which the person is engaging in an
occupation.
D.
No employer shall be held liable for failure to withhold
the local services tax or for the payment of the withheld tax money
to a political subdivision if the failure to withhold taxes arises
from incorrect information submitted by the employee as to the employee's
place or places of employment, the employee's principal office or
where the employee is principally employed.
Employers are required to make and file a local
services tax quarterly return 30 days after the end of each quarter
of a calendar year. The local services tax quarterly return shall
list the name, address and social security number of the employee;
the physical address of the employee's place of employment; the number
of payroll periods for which the local services tax was withheld;
and the amount of local services tax being remitted for each employee.
Each employer shall use his employment and payroll
records from the first day of January to March 31 each year for determining
the number of employees from whom said tax shall be deducted and paid
over to the collector on or before April 30 of the same calendar year.
Supplemental reports shall be made by each employer on July 30, October
30 and January 31 for new employees as reflected on his employment
and payroll records from April 1 to June 30, July 1 to September 30
and October 1 to December 31, and payments on these supplemental reports
shall be made on July 30, October 30 and January 30, respectively.
A.
In the event a person is engaged in more than one
occupation, that is, concurrent employment, or an occupation which
requires the person work in more than one political subdivision during
the payroll period, the priority of claim to collect the local services
tax shall be in the following order:
(1)
The political subdivision in which a person maintains
his or her principal office or is principally employed;
(2)
The political subdivision in which the person resides
and works, if the tax is levied by that political subdivision;
(3)
The political subdivision in which a person is employed
and which imposes the tax nearest in miles to the person's home.
B.
In the case of concurrent employment, an employer
shall refrain from withholding the local services tax if the employee
provides:
(1)
A recent pay statement from a principal employer that
includes the name of the employer, the length of the payroll period
and the amount of local services tax withheld; and
(2)
A statement from the employee that the pay statement
is from the employee's principal employer and the employee will notify
other employers of a change in principal place of employment within
two weeks of its occurrence.
C.
The situs of the tax shall be the place of employment
on the first day the person becomes subject to the tax during each
payroll period. It is the intent of this section that no person shall
be subject to the payment of the local services tax by more than one
political subdivision during each payroll period.
A.
The local services tax shall be no more than $52 on
each person for each calendar year, irrespective of the number of
political subdivisions within which a person may be employed.
B.
The law requires municipalities and school districts
who levy the local services tax at a combined rate exceeding $10 to
exempt any person from the local services tax whose total earned income
and net profits from all sources within the political subdivision
is less than $12,000 for the calendar year in which the local services
tax is levied.
C.
Each political subdivision levying the local services
tax shall exempt the following persons from the local services tax:
(1)
Any person who served in any war or armed conflict
in which the United States was engaged and is honorably discharged
or released under honorable circumstances from active service if,
as a result of military service, the person is blind, paraplegic or
a double or quadruple amputee or has a service-connected disability
declared by the United States Veterans' Administration or its successor
to be a total, one-hundred-percent permanent disability.
(2)
Any person who serves as a member of a reserve component
of the armed forces and is called to active duty at any time during
the taxable year. A "reserve component of the armed forces" shall
mean the United States Army Reserve, United States Navy Reserve, United
States Marine Corps Reserve, United States Coast Guard Reserve, United
States Air Force Reserve, The Pennsylvania Army National Guard or
The Pennsylvania Air National Guard.
D.
A person seeking to claim an exemption from the local
services tax may annually file an exemption certificate with the collector
of the tax for the political subdivision levying the tax and file
a copy of the certificate with the person's employer affirming that
the person reasonably expects to receive earned income and net profits
from all sources within the political subdivision of less than $12,000
in the calendar year for which the exemption certificate is filed.
E.
The exemption certificate shall have attached to it
a copy of all of the employee's last pay stubs or W-2 forms from employment
within the political subdivision for the year prior to the fiscal
year for which the employee is requesting to be exempted from the
local services tax.
F.
Upon receipt of the exemption certificate and until
otherwise instructed by the collector of the tax for the political
subdivision levying the tax the employer shall not withhold the tax
from the person during the calendar year or remainder of the calendar
year for which the exemption certificate applies. With respect to
a person who claimed an exemption from the local services tax, upon
notification to an employer by the person or by the collector of the
tax for the political subdivision that the person has received earned
income and net profits from all sources within that political subdivision
equal to or in excess of $12,000 in that calendar year or that the
person is otherwise ineligible for the tax exemption for that calendar
year, or upon an employer's payment to the person of earned income
within that political subdivision in an amount equal to or in excess
of $12,000 in that calendar year, an employer shall withhold the local
services tax from the person as follows:
(1)
If a person who claimed an exemption from the local
services tax for a given calendar year becomes subject to the tax
for the calendar year the employer shall withhold the tax for the
remainder of that calendar year.
(2)
The employer shall withhold from the person, for the
first payroll period after receipt of the notification under the above
subsection, a lump sum equal to the amount of the tax that was not
withheld from the person due to the exemption certificate filed by
the person, plus the per-payroll amount due for that first payroll
period.
(3)
The amount of tax withheld per payroll period for
the remaining payroll periods in that calendar year shall be the same
amount withheld for other employees.
(4)
In the event the employment of a person subject to
withholding of the local services tax under this exception is severed
in that calendar year, the person shall be liable for any outstanding
balance of tax due, and the political subdivision levying the tax
may pursue collection under this act.
(5)
Employers shall not be responsible for investigating
exemption certificates, monitoring tax exemption eligibility or exempting
any employee from the local services tax.
(6)
Employers shall be responsible for retaining a copy
of all exemption certificates filed by employees within a given calendar
year for a minimum of three years. Employers who have failed to withhold
the local services tax from an employee or employees, and do not have
copies of the employee exemption certificate or certificates, will
be held responsible for the payment of the local services tax as if
the tax had been originally levied against the employer.
G.
In the
event that an individual should earn less than $12,000 in annual salary,
wages, commissions or other compensation taxable from all sources
under this ordinance, said individual may, on or before April 15 of
each calendar year, apply for and be granted a refund of the local
services tax paid by said individual during the calendar year, forms
for said refund to be provided by the local services tax collector.
[Added 11-16-2009 by Ord. No. 2009-388]
All self-employed individuals and individuals
whose employer is not required to withhold local taxes will be billed
quarterly for the local services tax. The full amount of tax must
be paid by the date indicated on such billing. If such taxpayer qualifies
for a low-income exemption, the taxpayer may complete the required
exemption certificate or make application for a refund of the tax
paid.
All employers and self-employed individuals
residing or having their place of business outside Palmer Township
but who engage in any occupation within Palmer Township do, by virtue
thereof, agree to be bound by and subject themselves to the provisions,
penalties and regulations promulgated under this ordinance with the
same force and effect as though they were residents of Palmer Township.
Further, any individual engaged in an occupation within Palmer Township
and an employee of a nonresident employer may, for the purpose of
this ordinance, be considered a self-employed person, and in the event
this tax is not paid, the collector shall have the option of proceeding
against either the employer or employee for collection of this tax
as hereinafter provided.
A.
It shall be the duty of the collector to accept and
receive payments of this tax and keep a record thereof showing the
amount received by him from each employer or self employed person,
together with the date the tax was received. It shall be the duty
of the collector to accept and keep a record of the information submitted
by employers relating to the number of employees subject to the tax,
the number of employees exempt from the tax, the employee exemption
certificates and refunds of the tax paid to individuals and employers.
B.
The collector is hereby charged with the administration
and enforcement of this ordinance and is hereby empowered to prescribe,
adopt, promulgate and enforce rules and regulations relating to any
matter pertaining to the administration and enforcement of this ordinance,
including provisions for the examination of the payroll records of
any employer subject to this ordinance; the examination and correction
of any return made in compliance with this ordinance; and any payment
alleged or found to be incorrect or as to which overpayment is claimed
or found to have occurred. Any person aggrieved by any decision of
the collector shall have the right to appeal to the Court of Common
Pleas of Northampton County, as in other cases provided.
C.
The collector is hereby authorized to examine the
books and payroll records of any employer in order to verify the accuracy
of any return made by an employer, or, if no return was made, to ascertain
the tax due. Each employer is hereby directed and required to give
the collector the means, facilities and opportunity for such examination.
A.
In the event any of the tax under this ordinance remains
due or unpaid 30 days after the due date set forth above, the collector
may sue for the recovery of such tax due or unpaid, together with
interest and penalty.
B.
If for any reason the tax is not paid when due, interest
at the rate of 6% per annum on the amount of said tax, and an additional
penalty of 10%, shall be added to the flat rate of said tax for nonpayment
thereof. Where suit is brought for the recovery of this tax, the individual
liable therefor shall, in addition, be responsible and liable for
the costs of collection, including but not limited to attorneys' fees.
Whoever makes any false or untrue statement
on any return required by this ordinance, or who refuses inspection
of his books, records or accounts in his custody and control in order
to determine the number of employees subject to this tax who are in
his employment, or who fails or refuses to file any return required
by this ordinance, or fails or refuses to pay the tax herein levied
shall, upon conviction, be sentenced to pay a fine of not more than
$600, plus costs, and, in default of payment of said fine and costs,
be sentenced to a term of imprisonment not to exceed 30 days. It is
further provided that the action to enforce the fine and penalty herein
provided may be instituted against any person in charge of the business
of any employer who has failed or refused to file a return required
by this ordinance.
The provisions of this ordinance shall be severable.
If any of its provisions shall be held to be unconstitutional, illegal
or otherwise invalid, that decision shall not affect the remaining
provisions of this ordinance or of the Palmer Township Code of Ordinances.
This ordinance shall become effective in accordance
with applicable law, with the repeal of previous Occupational Privilege
Tax and Emergency and Municipal Services Tax Ordinances, effective
January 1, 2008.