[Adopted 10-6-2009 by Ord. No. 2009-02]
This article shall be known as and may be cited as "The Borough
of Elverson Local Services Tax Ordinance."
[Added at time of adoption of Code (see Ch. 1, General Provisions,
Art. I)]
The local services tax is authorized by the Local Tax Enabling
Act, 53 P.S. § 6924.101 et seq.
The following words and phrases, when used in this article,
shall have the meanings ascribed to them in this section, except where
the context or language clearly indicates or requires a different
meaning:
The area within the corporate limits of the Borough of Elverson,
Chester County, Pennsylvania.
The person, public employee or private agency designated
by the Borough of Elverson to collect and administer the tax herein
imposed.
The Department of Community and Economic Development of the
Commonwealth of Pennsylvania.
Compensation as required to be reported to or as determined
by the Department of Revenue under Section 303 of the Act of March
4, 1971 (P.L. 6, No. 2), known as the "Tax Reform Code of 1971," and
rules and regulations promulgated under that section subject to the
following:
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
An individual, partnership, association, limited liability
corporation, limited liability partnership, corporation, governmental
body, agency or other entity employing one or more persons on a salary,
wage, commission or other compensation basis, including a self-employed
person.
Indicates the singular and plural number, as well as male,
female and neuter genders.
Any person, male or female, engaged in any occupation, trade
or profession within the corporate limits of the Borough of Elverson.
The net income from the operation of a business, other than
a corporation, as required to be reported to or as determined by the
Department of Revenue under Section 303 of the Act of March 4, 1971
(P.L. 6, No. 2), known as the "Tax Reform Code of 1971," and rules
and regulations promulgated under that section. The term does not
include income under any of the following subsections.
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
Any trade, profession, business or undertaking of any type,
kind or character, including services, domestic or other, earned on
or performed within the corporate limits of the Borough of Elverson
for which compensation is charged or received, whether by means of
salary, wages, commission or fees for services rendered.
The local services tax at the rate fixed in § 246-12 of this article.
The period from January 1 until December 31 in any year;
a calendar year.
For specific revenue purposes, an annual tax is hereby levied
and assessed, commencing January 1, 2010, upon the privilege of engaging
in an occupation with a primary place of employment within the Borough
of Elverson during the tax year. Each natural person who exercises
such privilege for any length of time during any tax year shall pay
the tax for that year in the amount of $52, assessed on a pro rata
basis, in accordance with the provisions of this article. This tax
may be used solely for the following purposes, as the same may be
allocated by the Borough of Elverson from time to time: (1) emergency
services, which shall include emergency medical services, police services
and/or fire services; (2) road construction and/or maintenance; (3)
reduction of property taxes; or (4) property tax relief through implementation
of a homestead and farmstead exclusion in accordance with 53 Pa.C.S.A.
Chapter 85, Subchapter F (relating to homestead property exclusion).
The Borough shall use no less than 25% of the funds derived from the
tax for emergency services. This tax is in addition to all other taxes
of any kind or nature heretofore levied by the Borough. The 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.
A.
Exemption. Any person whose total earned income and net profits from
all sources within the Borough is less than $12,000 for any calendar
year in which the tax is levied is exempt from the payment of the
tax for that calendar year. In addition, the following persons are
exempt from payment of the tax:
(1)
Any person who has 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 100% 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. For the purposes of this subparagraph, "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.
B.
Procedure to claim exemption.
(1)
A person seeking to claim an exemption from the local services tax may annually file an exemption certificate with the Borough and with the person's employer affirming 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. In the event the Borough utilizes a tax collection officer, it shall provide a copy of the exemption certificate to that officer. The exemption certificate shall have attached to it a copy of all 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 tax. Upon receipt of the exemption certificate, and until otherwise instructed by the Borough or except as required by Subsection B(2), 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. Employers shall ensure that the exemption certificate forms are readily available to employees at all times and shall furnish each new employee with a form at the time of hiring. The exemption certificate form shall be the uniform form provided by the Borough.
(2)
With respect to a person who claimed an exemption for a given calendar year from the tax, upon notification to an employer by the person or by the Borough 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 within the 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 under Subsection B(3).
(3)
If a person who claimed an exemption for a given calendar year from the tax becomes subject to the tax for the calendar year under Subsection B(2), 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 receipt of the notification under Subsection B(2), 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 that first 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 withholding of the tax under this clause is subsequently severed in that calendar year, the person shall be liable for any outstanding balance of tax due, and the Borough may pursue collection under this article.
C.
Refunds. The Borough Secretary, in consultation with the Collector
and DCED, shall establish procedures for the processing of refund
claims for any tax paid by any person who is eligible for exemption,
which procedures shall be in accord with provisions of the general
municipal law relating to refunds of overpayments and interest on
overpayments. Refunds made within 75 days of a refund request or 75
days after the last day the employer is required to remit the tax
for the last quarter of the calendar year, whichever is later, shall
not be subject to interest. No refunds shall be made for amounts overpaid
in a calendar year that do not exceed $1. The Borough Secretary or
the Collector shall determine eligibility for exemption and provide
refunds to exempt persons.
A.
Each employer within the Borough of Elverson, as well as those employers
situated outside the Borough of Elverson but who engage in business
within the Borough of Elverson, is hereby charged with the duty of
collecting the tax from each of its employees engaged by it or performing
for it within the Borough of Elverson and making a return and payment
thereof to the Collector. Further, each employer is hereby authorized
to deduct this tax for each employee in its employ, whether said employee
is paid by salary, wage or commission and whether or not all such
services are performed within the Borough of Elverson.
B.
A person subject to the tax shall be assessed by the employer 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 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 one-hundredth of a dollar. Collection of the tax shall be made on a payroll-period basis for each payroll period in which the person is engaging in an occupation, except as provided in Subsection D of this section. For purposes of this paragraph, combined rate shall mean the aggregate annual rate of the tax levied by the school district and the Borough.
C.
No person shall be subject to the payment of the local services tax
by more than one political subdivision during each payroll period.
D.
In the case of concurrent employment, an employer shall refrain from
withholding the 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 tax withheld,
and 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. The employee's statement shall be provided on the form
approved by DCED.
E.
The 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. The Borough shall provide a taxpayer
a receipt of payment upon request by the taxpayer.
F.
No employer shall be held liable for failure to withhold the tax or for the payment of the withheld tax money to the Borough 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. Further, an employer shall not be liable for payment of the local services tax in an amount exceeding the amount withheld by the employer if the employer complies with the provisions of § 246-13B of this article and this section and remits the amount so withheld in accordance with this article.
G.
Employers shall be required to remit the local services taxes 30
days after the end of each quarter of a calendar year.
Each employer shall prepare and file a return showing a computation
of the tax on forms to be supplied to the employer by the Collector.
If an employer fails to file the return and pay the tax, whether or
not the employer makes collection thereof from the salary, wages or
commissions paid by it to an employee, except as provided hereafter
in this article, the employer shall be responsible for the payment
of the tax in full, as though the tax had been originally levied against
the employer.
In each tax year, each employer shall use his or her employment
records to determine the number of employees from whom such tax shall
be deducted and paid over to the Collector on or before the 30th day
following the end of each calendar quarter of each such tax year.
Each self-employed individual who performs services of any type
or kind or engages in any occupation or profession within a primary
place of employment within the Borough shall be required to comply
with this article and pay the pro rata portion of the tax due to the
Collector on or before the 30th day following the end of each quarter.
A.
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
working 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:
(1)
First, the political subdivision in which a person maintains his
or her principal office or is principally employed;
(2)
Second, the political subdivision in which the person resides and
works if the tax is levied by that political subdivision; and
(3)
Third, the political subdivision in which a person is employed and
which imposes the tax nearest in miles to the person's home.
B.
In case of dispute, a tax receipt of the taxing authority for that
calendar year declaring that the taxpayer has made prior payment constitutes
prima facie certification of payment to all other political subdivisions.
All employers and self-employed individuals residing or having
their places of business outside of the Borough of Elverson, but who
perform services of any type or kind or engage in any occupation or
profession within the Borough of Elverson, do, by virtue thereof,
agree to be bound by and subject themselves to the provisions, penalties
and regulations promulgated under this article with the same force
and effect as though they were residents of the Borough of Elverson.
Further, any individual engaged in an occupation within the Borough
of Elverson and an employee of a nonresidential employer may, for
the purpose of this article, be considered a self-employed person,
and in the event his or her tax is not paid, the Borough shall have
the option of proceeding against either the employer or employee for
the collection of this tax as hereinafter provided.
A.
The Collector shall be appointed by resolution of the political subdivision.
It shall be the duty of the Collector to accept and receive payments
of this tax and to 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.
B.
The Collector is hereby charged with the administration and enforcement
of this article and is hereby charged and empowered, subject to Borough
Council approval, to prescribe, adopt and promulgate rules and regulations
relating to any matter pertaining to the administration and enforcement
of this article, including provisions for the examination of payroll
records of any employer subject to this article, the examination and
correction of any return made in compliance with this article 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 consistent
with the Local Taxpayers Bill of Rights under Act 50 of 1998.
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 that any tax under this article remains due or unpaid
30 days after the due dates above set forth, the Collector may sue
for the recovery of any such tax due or unpaid under this article,
together with interest and penalty.
B.
If for any reason the tax is not paid when due, interest at the rate
of 6% on the amount of such tax shall be calculated beginning with
the due date of the tax, and a penalty of 5% shall be added to the
flat rate of such tax for nonpayment thereof. Where suit is brought
for the recovery of this tax or other appropriate remedy undertaken,
the individual liable therefor shall, in addition, be responsible
and liable for the costs of collection.
Whoever makes any false or untrue statement on any return required
by this article, or whoever refuses inspection of the books, records
or accounts in his or her custody and control setting forth the number
of employees subject to this tax who are in his or her employment,
or whoever fails or refuses to file any return required by this article
shall be guilty of a violation and, upon conviction thereof, shall
be sentenced to pay a fine of not more than $600 and costs of prosecution
and, in default of payment of such fine and costs, to imprisonment
for not more than 30 days. The action to enforce the penalty herein
prescribed may be instituted against any person in charge of the business
of any employer who shall have failed or who refuses to file a return
required by this article.
A.
Nothing contained in this article shall be construed to empower the
Borough of Elverson to levy and collect the tax hereby imposed on
any occupation not within the taxing power of the Borough of Elverson
under the Constitution of the United States and the laws of the Commonwealth
of Pennsylvania.
B.
If the tax hereby imposed under the provisions of this article shall
be held by any court of competent jurisdiction to be in violation
of the Constitution of the United States or of the laws of the Commonwealth
of Pennsylvania as to any individual, the decision of the court shall
not affect or impair the right to impose or collect said tax or the
validity of the tax so imposed on other persons or individuals as
herein provided.
The tax imposed by this article shall be effective on January
1, 2010, and all calendar years thereafter, unless repealed or modified
by ordinance of the Borough Council.
