This article, and any supplements and amendments thereto, shall be known and may be cited as the "Newtown Borough Local Services Tax Ordinance." This article is enacted under the authority of the Pennsylvania Local Tax Enabling Act, 53 P.S. § 6924.101 et seq., and continues and redesignates the emergency and municipal services tax as the local services tax pursuant to Act 7 of 2007.
[Adopted 10-10-1995 by Ord. No. 528 (Ch. 139, Art. III, of the 1982 Code); amended in its entirety at time of adoption of Code (see Ch. 1, General Provisions, Art. I)]
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 Newtown Borough, Bucks County, Pennsylvania.
The person or agency appointed from time to time by the Newtown Borough Council to assess and collect the tax imposed under, and to administer the provisions of, this article.
The Department of Community and Economic Development of the Commonwealth of Pennsylvania.
Compensation, as this term is defined in Section 501 of the Local Tax Enabling Act, 53 P.S. § 6924.501, as amended.
Any individual, partnership, association, corporation, limited-liability company, governmental body, agency or any other entity employing one or more persons on a salary, wage, commission, barter or other compensation basis, including a self-employed person.
The twelve-month period beginning January 1 and ending December 31, and each twelve-month period thereafter.
Any person, male or female, over the age of 18 years, engaged in any occupation, trade or profession within the corporate limits of Newtown Borough for any length of time in any given fiscal year.
The net income from the operation of a business, profession, or other activity, as this term is defined in Section 501 of the Local Tax Enabling Act, 53 P.S. § 6924.501, as amended.
Any trade, profession, business or undertaking of any type, kind or character, including services, domestic or other, carried on or performed within the corporate limits of Newtown Borough, for which compensation is charged or received, whether by means of salary, wages, commission, barter or fees for services rendered.
The local services tax in the amount of $52 per individual engaged in an occupation in the Borough per fiscal year levied by this article.
The provisions of Act 511, its supplements and amendments are incorporated in this article by reference, except as and where specifically and expressly provided otherwise.
A.
Beginning January 1, 2010, for specific revenue purposes, Newtown Borough hereby levies and imposes on each occupation engaged in by individuals within its corporate limits during the fiscal year of 2010 and each fiscal year thereafter a local services tax in the amount of $52 per annum. Each individual who engages in an occupation shall pay the local services tax in the amount of $52 for the fiscal year in which the individual has engaged in the occupation, assessed on a pro rata basis, in accordance with the provisions of this article. The local services tax shall be no more than $52 on each individual for each fiscal year, irrespective of the number of political subdivisions within which an individual may be employed.
B.
This tax is in addition to all other taxes of any kind or nature previously levied by Newtown Borough. This tax shall continue in force on a calendar-year basis, without annual reenactment, unless the rate of the tax is subsequently changed or this article is repealed or amended.
C.
In accordance with the Act, the revenue derived from this tax may be used solely for the following purposes as the same may be allocated by the Borough 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).
D.
The Borough shall use no less than 25% of the funds derived from the tax for emergency services.
A.
Exemptions. The following individuals are exempt from payment of the tax:
(1)
Any individual whose total earned income and net profits from all sources within Newtown Borough is less than $12,000 for any fiscal year in which the local services tax is levied is exempt from the payment of the local services tax for that fiscal year.
(2)
Any individual 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.
(3)
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 subsection, "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)
An individual seeking to claim an exemption from the tax may annually file an exemption certificate with the Borough and with the individual's employer affirming that the individual reasonably expects to receive earned income and net profits from all sources within the Borough of less than $12,000 in the fiscal year for which the exemption certificate is filed. In the event the Borough utilizes a tax collection officer, the Borough shall provide a copy of the exemption certificate to that officer. The exemption certificate shall have attached to it a copy of all the individual's last pay stubs or W-2 forms from employment within the Borough for the year prior to the fiscal year for which the individual 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) below, the employer shall not withhold the tax from the individual during the fiscal year or the remainder of the fiscal 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 an individual who claimed an exemption from the tax for a given fiscal year, upon notification to an employer by the individual or by the Borough that the individual has received earned income and net profits from all sources within the Borough equal to or in excess of $12,000 in that fiscal year or that the individual is otherwise ineligible for the tax exemption for that fiscal year, or upon an employer's payment to the individual of earned income within the Borough in an amount equal to or in excess of $12,000 in that fiscal year, an employer shall withhold the tax from the individual under Subsection B(3) below.
(3)
If an individual who claimed an exemption from the tax for a given fiscal year becomes subject to the tax for the fiscal year under Subsection B(2) above, the employer shall withhold the tax for the remainder of that fiscal year. The employer shall withhold from the individual, for the first payroll period after receipt of the notification under Subsection B(2) above, a lump sum equal to the amount of tax that was not withheld from the individual due to the exemption claimed by the individual 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 fiscal year shall be the same amount withheld for other employees. In the event the employment of an individual subject to withholding of the tax under this subsection is subsequently severed in that fiscal year, the individual shall be liable for any outstanding balance of tax due, and the Borough may pursue collection under the provisions of this article.
C.
Refunds.
(1)
The Borough, in consultation with the Collector and DCED, shall establish procedures for the processing of refund claims for any tax paid by any individual who is eligible for exemption. Such procedures shall be in accord with provisions of the general municipal law relating to refunds of overpayments and interest on overpayments.
(2)
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 fiscal year, whichever is later, shall not be subject to interest.
(3)
No refunds shall be made for amounts overpaid in a fiscal year that do not exceed $1.
(4)
The Borough or the Collector shall determine eligibility for exemption and provide refunds to exempt individuals.
A.
Each employer within the Borough and each employer situated outside the Borough but who engages in business within the Borough is hereby charged with the duty of collecting the tax from each employee engaged by the employer and performing for the employer within the Borough and making a return and payment of the tax to the Collector.
B.
Each employer is authorized to deduct the tax for each employee in the employer's employ, whether the employee is paid by salary, wage or commission and whether or not all such services are performed within the Borough.
C.
An individual subject to the tax shall be assessed by the employer a pro-rata share of the tax for each payroll period in which the individual is engaging in an occupation. The pro-rata share of the tax assessed on the individual for a payroll period shall be determined by dividing the rate of the tax levied for the fiscal year by the number of payroll periods established by the employer for the fiscal 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. Collection of the tax shall be made on a payroll-period basis for each payroll period in which the individual is engaging in an occupation, except as provided in Subsection E below. For purposes of this Subsection C, "combined rate" shall mean the aggregate annual rate of the tax levied by the Council Rock School District and the Borough.
D.
No individual shall be subject to the payment of the local services tax by more than one political subdivision during each payroll period.
E.
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.
F.
The tax shall be no more than $52 on each person for each calendar year, irrespective of the number of political subdivisions within which an individual may be employed. The Borough shall provide a taxpayer a receipt of payment upon request by the taxpayer.
G.
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 tax in an amount exceeding the amount withheld by the employer if the employer complies with the provisions of § 501-8B of this article and this section and remits the amount so withheld in accordance with this article.
H.
Employers shall be required to remit the local services taxes within 30 days after the end of each quarter of a fiscal year.
A.
Each employer shall prepare and file a return showing a computation of the tax on forms to be supplied by the Collector.
B.
Taxes deducted from wages by an employer shall at all times be and remain the property of this Borough and shall constitute a trust fund in the employer's hands until remitted to the Collector. Deduction of taxes from wages shall, as between the employee and the Borough, constitute payment of the tax by the employee, regardless of any insolvency or failure to remit on the employer's part.
C.
If the employer fails to file the return provided for elsewhere in this article and pay the tax, whether or not he makes collection thereof from the salary, wages or commissions paid by the employer to the employee, except as provided in this article, the employer shall be responsible for payment of the tax in full as though the tax had originally been levied against the employer.
D.
In each fiscal year, each employer shall use the employer's employment records to determine the number of employees from whom the 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 fiscal year.
A.
The situs of the tax shall be the place of employment on the first day the individual becomes subject to the tax during each payroll period. In the event an individual is simultaneously engaged in more than one occupation or engaged in an occupation which requires the individual 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:
(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;
(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 fiscal year declaring that the taxpayer has made prior payment constitutes prima face certification of payment to all other political subdivisions.
Each self-employed individual who performs services of any type or kind or engages in any occupation or profession 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.
All employers and self-employed individuals residing or having their place of business outside the Borough but who perform services of any type or kind or engage in any occupation or profession within the Borough 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. Any individual engaged in an occupation within the Borough and an employee of a nonresident employer may, for the purpose of this article, be considered a self-employed person, and in the event the 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 Borough. It shall be the duty of the Collector to accept and receive payments of the tax and to keep a record thereof showing the amount received by the Collector from each employer and 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 prior Borough 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.
C.
The Collector or a duly authorized representative or agent 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 or a duly authorized representative or agent the means, facilities and opportunity for such examinations.
A.
In the event that any tax under this article remains due or unpaid 30 days after the due dates set forth in this article, the Borough or 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% per annum on the amount of the tax shall be calculated beginning with the due date of the tax, and an additional penalty of 0.5% of the amount of the unpaid tax shall be added and collected for each month or fraction thereof during which the tax remains unpaid. 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 reasonable attorneys' fees.
C.
Any person who makes any false or untrue statement on any return required by this article, or who refuses inspection of his books, records or accounts in his custody and control setting forth the number of employees subject to this tax who are in his employment, or whoever fails or refuses to file any return required by this article, commits a violation of this article.
D.
Any person who violates or permits a violation of this chapter shall, upon being found liable therefor, pay a fine of not more than $600, plus court costs and reasonable attorneys' fees incurred by the Borough in the enforcement proceedings. If the penalty is not paid, the Borough shall initiate a civil action for collection in accordance with the Pennsylvania Rules of Civil Procedure. Each day a violation exists shall constitute a separate offense, and each section of this chapter that is violated shall also constitute a separate offense. In addition to or in lieu of enforcement under this section, the Borough may enforce this chapter in equity in the Court of Common Pleas of Bucks County.
E.
The action to enforce the provisions of this article may be instituted against any person in charge of the business of any employer who shall have failed or refused to file a return required by this article.
A.
Nothing contained in this article shall be construed to empower the Borough to levy and collect the tax hereby imposed on any occupation not within the taxing power of the Borough 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 to be in violation of the Constitution of the United States or of the laws of the Commonwealth of Pennsylvania as to any individual, such decision shall not affect or impair the right to impose or collect the tax, or the validity of the tax so imposed, on other persons or individuals as herein provided.
C.
It is the intent of this article that the entire burden of the tax imposed on an occupation by the Borough and the Council Rock School District shall not exceed the limitations prescribed in Act 511, and therefore the Council Rock School District shall be entitled to its share of the tax in accordance with the provisions of Act 511.
D.
Nothing in this article or in any enactment of Newtown Borough Council relating to the imposition of a tax under the Act on the privilege of engaging in an occupation shall be construed to repeal the imposition and collection of any occupation privilege tax, plus applicable penalties and interest, for calendar year 2006 and all prior calendar years, or of an emergency and municipal services tax, plus applicable penalties and interest, for calendar year 2007, as the same exist prior to this amendment.