[Adopted 11-13-2006 by Ord. No. 321]
The tax to be imposed pursuant to this article shall be known as the "Local Services Tax" and may also be referred to as the "LST tax."
The following terms shall have, for the purposes of this article, the following meanings:
- CALENDAR QUARTER
- The four three-month intervals, January through March, April through June, July through September, and October through December.
- Includes earned income and net profits from salaries, wages, commissions, bonuses, incentive payments, fees and tips that may accrue or be received by a person for services rendered, whether directly or through an agent, and whether in cash or in property; provided, however, that all such compensation must have been earned from sources within New Britain Borough. "Compensation" shall not include periodic payments for sick or disability benefits and those commonly recognized as old-age benefits, retirement pay, or pensions paid to persons retired from service after reaching a specific age or after a stated period of employment, and does not include public assistance or unemployment compensation payments, nor any wages or compensation paid by the United States to any person for active duty in the armed forces of the United States nor any bonuses or additional compensation paid by the United States or the Commonwealth of Pennsylvania or any other state for such active duty service.
- EARNED INCOME
- See "compensation" as defined above.
- A person, a person who is self-employed, a partnership, an association, a corporation, an institution, a governmental body or unit or agency, or any other entity having a place of business in and employing one or more persons within the physical limits of New Britain Borough for a salary, wage, commission or other compensation.
- LST TAX
- The local services tax in the amount of $52 levied by this article.
- LST TAX COLLECTOR
- Person, public employee or private agency designated by the Borough Council of New Britain Borough to collect and administer the LST tax.
- NET PROFITS
- See "compensation" as defined above.
- Any trade, profession, business, occupation or undertaking of any type, kind or character, carried on or performed within the corporate limits of New Britain Borough, for which compensation is charged or received.
- A natural person.
Commencing the first day of January 2008 and annually thereafter, there is hereby imposed on each person engaged in an occupation within the physical limits of New Britain Borough at any time during a calendar year an LST in the amount of $52. This tax is in addition to all other taxes of every kind or nature levied by New Britain Borough.
The following persons shall be exempt from payment of the LST tax:
Those persons who earn income or net profits from sources within the Borough of less than $12,000 for the calendar year shall be exempted from the LST tax for that year, provided that such a person or his or her employer, files an exemption certificate with the LST Tax Collector stating that the person reasonably expects to receive earned income and net profits from all sources within the Borough of less than $12,000 in the calendar year for which the exemption certificate is filed. 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 Borough for the year prior to the fiscal year for which the employee is requesting to be exempted from the local services tax, unless the employee was not employed with the employer during the prior fiscal year.
Any person who served in any war or armed conflict in which the United States was engaged and who was honorably discharged or released under honorable circumstances from active service and, as a result of that service, the person is blind, paraplegic or at least a double 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 shall be exempt from the LST tax, provided that such person files with his employer and the Borough the exemption certificate required in this section.
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 shall be exempt from the LST tax during the year of armed forces service, provided that such person files with his employer and the Borough the exemption certificate required in this section. "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.
Upon receipt of the exemption certificate and until otherwise instructed by the Borough, the employer shall not withhold the tax from the person during the calendar year or the remainder of the calendar year for which the exemption certificate applies. If and to the extent that any tax has been paid by or on behalf of such an exempted person in a year, the collected tax shall be refunded to that person. Employers may obtain blank exemption certificates from New Britain Borough and all employers shall maintain a supply of exemption certificates for use by their employees. Furthermore, employers shall furnish each new employee with an exemption certificate form at the time of hiring.
With respect to a person who claimed an exemption for a given calendar year from the local services tax, upon notification to an employer by the person or by the political subdivision that the person has received earned income and net profits from all sources within the Borough 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 in New Britain Borough 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 required in § 397-15 above. If a person who claimed an exemption for a given calendar year from the local services tax becomes subject to the tax for the calendar year after having claimed an exemption from the tax, the employer shall withhold the tax for the remainder of that calendar year. The employer shall withhold from the person, for the first payroll period after the employer has recognized that the person is actually subject to the tax, a lump sum equal to the amount of tax that was not withheld from the person due to the exemption claimed by the person under this subsection plus the per payroll amount due for the immediate payroll period. 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. In the event the employment of a person subject to LST withholding is terminated from employment before paying the total tax due of $52 for the year, the person shall be liable for any outstanding balance of tax due, and the Borough may pursue collection as permitted by law.
Any person who is engaged in an occupation within the physical limits of New Britain Borough in any year who is self-employed shall make a declaration of his occupation within the Borough and shall file that declaration with the LST Tax Collector, utilizing a form prescribed or approved by the Tax Collector. Thereafter, the self employed person shall be assessed a pro rata share of the tax for each payroll period in which the person is engaging in an occupation. The pro rata share of the tax assessed on the person for a payroll period shall be determined by dividing the rate of the LST tax ($52 per year) by the number of payroll or draw or distribution periods established by the person for the calendar year. For purposes of determining the pro rata share, the amount of tax collected each payroll period shall be rounded down to the nearest 1/100 dollar. In the event that a self-employed person does not take regular or uniform draws or paychecks or distributions, then he or she shall make a reasonable estimate of the number of draws or paychecks or distributions he or she will take during the calendar year and divide the tax amount ($52) by the estimated number of draws or paychecks or distributions estimated to be taken for the calendar year, and that amount shall be deducted from each draw or paycheck or distribution and shall be submitted to the Tax Collector pursuant to § 397-19 below. In the event such a person shall take fewer paychecks or draws or distributions than initially estimated, so that the LST tax has not been paid by the end of the year, the person shall be immediately liable to pay the remaining balance of the tax due within 30 days after the end of the last calendar quarter. In the event that a person subject to this section does not receive paychecks or draws or distributions, but receives compensation as defined above, he or she shall apply the provisions of this section to estimate the frequency with which that compensation is paid, in whatever form, and divide the amount of the tax ($52) by the estimated number of times compensation is to be received. Whenever such compensation is to be paid, the pro rata share of the LST tax shall be withheld and submitted to the Tax Collector as provided herein. In the event that such compensation is paid on only one occasion, then the entire amount of the tax shall be withheld and submitted to the Tax Collector.
Every employer shall register with the LST ax Collector by providing the employer's name and address and shall provide such other information as the LST Tax Collector may require. Registration shall be completed within 15 days of the effective date of this article, and thereafter any employer not previously registered shall so register within 15 days of becoming an employer. Every employee subject to the LST tax pursuant to the terms of this article shall be assessed a pro rata share of the tax for each payroll period in which the person is engaging in an occupation. The pro rata share of the tax assessed on the person for a payroll period shall be determined by dividing the rate of the LST tax ($52 per year) by the number of payroll periods established by the employer for the calendar year. For purposes of determining the pro rata share, the amount of tax collected each payroll period shall be rounded down to the nearest 1/100 dollar. Every employer shall withhold that amount from each employee paycheck and shall remit the local services taxes withheld to the Tax Collector no more than 30 days after the end of each quarter of a calendar year.
The LST Tax Collector is hereby charged within the enforcement of the provisions of this article and is authorized and empowered as follows:
To administer and enforce the provisions of this article and all rules and regulations prescribed, adopted and promulgated by the Borough Council of New Britain Borough relating to the enforcement and administration hereof and consistent with such rules and regulations shall have the power and authority to reexamine and correct any and all returns filed hereunder, and to compute, settle, resettle and discharge all taxes hereby levied.
The LST Tax Collector or any agent or employee of the Borough authorized in writing by the LST Tax Collector is hereby authorized and empowered to examine the books, papers and records of an employer or taxpayer in order to verify the accuracy of any return made or, if no return was made, to ascertain the tax imposed by this article. Every employer or taxpayer is hereby directed and required to give to the LST Tax Collector or a duly authorized agent or employee of the Borough the means, facilities and opportunity for such examinations and investigations as are hereby authorized. The LST Tax Collector is hereby authorized to examine any person under oath concerning any income which was or should have been returned for taxation and, to this end, may compel the production of books, papers and records and the attendance of all persons before him, whether as parties or witnesses, who he believes to have knowledge of such income.
Any information gained by the LST Tax Collector or any authorized agent or employee of the Borough as a result of any returns, investigations, hearings or verification required or authorized by this article shall be confidential, except for official purposes and except where disclosure of the contents thereof is required by proper judicial order or decree or as otherwise provided by law. Any person or agent who divulges any information so obtained shall, upon conviction therefor, be subject to the penalties hereinafter described.
Upon request of any taxpayer, the Tax Collector shall provide a receipt indicating taxes paid for the quarter by that taxpayer.
The New Britain Borough Council shall appoint an LST Tax Collector and fix the compensation of the LST Tax Collector by resolution. The LST Tax Collector shall collect and receive all taxes imposed by this article, furnish receipts for the payment thereof, keep records showing amounts received from all taxpayers and the dates of all such receipts, and keep such other records as may be, from time to time, required by the Borough Council of New Britain Borough.
All taxes imposed by this article remaining unpaid after they become due shall bear interest at the rate of 6% per year, and the persons upon whom said taxes are imposed shall be further liable to a penalty of 1/2 of 1% of the amount of the unpaid tax for each month or fraction of a month during which the tax remains unpaid. To the extent that an employer has failed to withhold the tax or, having withheld the tax, has failed to remit the tax in timely fashion to the Tax Collector, the interest and penalties of this section shall be applicable to the employer who, nevertheless, shall not be subject to the payment of penalty or interest if, in failing to withhold or remit the tax, the employer justifiably relied on inaccurate information provided by the employee, and that inaccurate information was reasonably the cause of the employer's failure to withhold or remit the tax.
No person shall be subject to the payment of the local services tax by more than one political subdivision during each payroll period. Furthermore, 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. In the event a person is engaged in more than one occupation, that is, concurrent employment, or an occupation which requires the person to work in more than one political subdivision during a payroll period, the priority of claim to collect the local services tax shall be in the following order: first, the political subdivision in which a person maintains the person's principal office or is principally employed (provided that political subdivision imposes the LST tax); second, the political subdivision in which the person resides and works, if the tax is levied by that political subdivision; and third, the political subdivision in which a person is employed and which imposes the tax nearest in miles to the person's home. In the case of concurrent employment, an employer shall refrain from withholding the local services tax if the employee provides 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 the local services tax withheld, and a statement from the employee that the pay statement is from the employee's principal employer and that the employee will notify other employers of a change in principal place of employment within two weeks of its occurrence.
Any person or employer who willfully violates any provision of this article shall be subject to prosecution for a summary offense and, upon conviction thereof, shall be subject to pay a fine not exceeding $500 plus costs and, in default of payment thereof, shall be subject to imprisonment for a term not to exceed 30 days. Each day that a violation of this article continues following receipt of written notice of violation shall constitute a separate offense. The penalties of this section are imposed in addition to the interest and penalties imposed in § 397-21 above.
In the event that any section, sentence, clause, phrase or word of this article shall be declared illegal, invalid or unconstitutional by any court of competent jurisdiction, such declaration shall not prevent, preclude or otherwise foreclose enforcement of any of the remaining portions of this article. Furthermore, in the event that any portion of this article shall be determined to be inconsistent with the provisions of the Local Tax Enabling Act, the Act of December 31, 1965, as amended, then the provisions of the said Act shall prevail, and this article shall be construed in a fashion that is consistent with the provisions of the Local Tax Enabling Act, as amended.
All ordinances or parts of ordinances inconsistent herewith or in conflict with any of the specific terms enacted hereby, to the extent of said inconsistencies or conflicts, are hereby specifically repealed. In addition, the provisions of Ordinance 313 of 2006, the Emergency and Municipal Services Tax Ordinance of the Borough, is hereby repealed as to calendar year 2008 and all subsequent years. The provisions of Ordinance 313 of 2006 shall remain in force regarding tax year 2007 and shall be enforceable in regard to all taxes due in consequence of the said ordinance for the year 2007.
This article is effective December 31, 2007.