[Adopted 11-10-2010 by Ord. No. 226-2010[1]]
[1]
Editor's Note: This ordinance also superseded
former Art. I, Local Services Tax, adopted 12-14-2005 by Ord. No.
176-2005, as amended 11-14-2007 by Ord. No. 199-2007, and provided
an effective date of 1-1-2011.
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:
An enterprise, activity, profession or any other undertaking
of an unincorporated nature conducted for profit or ordinarily conducted
for profit, whether by a person, partnership, association or any other
entity.
A sole proprietorship, corporation, joint-stock association
or company, partnership, limited partnership, limited liability company,
association, business trust, syndicate or other commercial or professional
activity organized under the laws of this commonwealth or any other
jurisdiction.
The person, public employee or private agency designated
by the Township to collect and administer the tax herein imposed.
Any corporation or joint-stock association organized under
the laws of the United States, the Commonwealth of Pennsylvania, or
any other state, territory, or foreign country or dependency. The
term shall include an entity which is classified as a corporation
for federal income tax purposes.
The Department of Community and Economic Development of the
Commonwealth of Pennsylvania.
The 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 (72 P.S. § 7303), known as the "Tax Reform Code of 1971," and rules and regulations promulgated under that section. Employee business expenses as reported to or determined by the Department of Revenue under Article III of the Tax Reform Code of 1971 shall constitute allowable deductions in determining earned income. The term does not include offsets for business losses. The amount of any housing allowance provided to a member of the clergy shall not be taxable as earned income.
A person, business entity or other entity employing one or
more persons for a salary, wage, commission or other compensation
basis. The term includes the commonwealth, a political subdivision
and an instrumentality or pubic authority of either. For purposes
of penalties under this article, the term includes a corporate officer.
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
(72 P.S. § 7303), 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:
A person or business domiciled outside of East Whiteland
Township.
Any enterprise, activity, profession, or undertaking of any
nature conduced for profit or ordinarily conducted for profit, whether
by an individual, association or other entity, whereby any wage, salary,
commission or other renumeration is earned.
A natural person.
A person or business domiciled in East Whiteland Township.
The local services tax at the rate fixed in § 180-2 of this article.
A person or business required hereunder to file a return
of an income tax or to pay an income tax.
East Whiteland Township.
A.
For specific revenue purposes, an annual tax is hereby levied and
assessed, commencing January 1, 2011, upon the privilege of engaging
in an occupation with a primary place of employment within East Whiteland
Township during the tax year. Each person who exercises such privilege
for any length of time during any tax year shall pay the tax for that
year in accordance with the provisions of this article. This tax is
in addition to all other taxes of any kind or nature heretofore levied
by the Township.
B.
D.
The tax shall be no more than $52 on each person for each calendar
year, irrespective of the number of municipalities within which a
person may be employed.
A.
Exemptions.
(1)
Income exemptions. Any person whose total earned income and net profits
from all sources within the Township 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.
(2)
Military service exemptions. In addition, the following persons are
exempt from payment of the tax:
(a)
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 one-hundred-percent disability.
(b)
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 income exemption.
(1)
A person seeking to claim an exemption from the local services tax may annually file an exemption certificate with the Township and with the person's employer affirming that the person reasonably expects to receive earned income and net profits from all sources within the Township of less than $12,000 in the calendar year for which the exemption certificate is filed. In the event the Township 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 Township 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 Township 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 Township.
(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 Township that the person has received earned income and net profits from all sources within the Township 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 municipality 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 subsection is subsequently severed in that calendar year, the person shall be liable for any outstanding balance of tax due, and the Township may pursue collection under this article.
C.
Procedure to claim military service exemption. Any person who qualifies
for a military service exemption shall provide documentation of the
same to the satisfaction of the collector.
D.
Refunds. East Whiteland Township, 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. East Whiteland Township
or the collector shall determine eligibility for exemption and provide
refunds to exempt persons.
A.
Each employer within the Township, as well as those employers situated
outside the Township but who engage in business within the Township,
is hereby charged with the duty of collecting the tax from each of
his employees engaged by him or performing for him within the Township
and making a return and payment thereof to the collector. Further,
each employer is hereby authorized to deduct this tax for each employee
in his or her employ, whether said employee is paid by salary, wage
or commission and whether or not all such services are performed within
the Township.
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 subsection, "combined rate" shall mean the aggregate annual rate of the tax levied by the school district and the municipality.
C.
No person shall be subject to the payment of the local services tax
by more than one township 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 Township 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 Township 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 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 him or her 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 Township 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;
(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 Township but who perform services
of any type or kind or engage in any occupation or profession within
the Township 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 Township. Further, any individual engaged in an occupation
within the Township 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 Township 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 Township. 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 of 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 municipal
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.[1]
[1]
Editor's Note: See 53 Pa.C.S.A. § 8421 et seq.
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.
D.
The collector shall demand, receive and collect from all employers,
other than the commonwealth, employing persons owing delinquent taxes,
or whose spouse owes delinquent taxes, upon the presentation of a
written notice and demand certifying that the information contained
therein is true and correct and containing the name of the taxable
or the spouse thereof and the amount of the tax due. Upon presentation
of such written notice and demand, it shall be the duty of an employer
to deduct from the wages, commissions or earnings of such individual
employees, then owing or that shall within 60 days thereafter come
into the employer's possession, a sum sufficient to pay the respective
amount of the delinquent taxes and costs, shown upon the written notice
or demand, and to pay the same to the collector within 60 days after
such notice shall have been given. No more than 10% of the wages,
commissions or earnings of the delinquent taxpayer or spouse thereof
may be deducted at any one time for delinquent taxes and costs. The
employer shall be entitled to deduct from the moneys collected from
each employee the costs incurred from the extra bookkeeping necessary
to record such transactions, not exceeding 2% of the amount of money
so collected and paid over to the collector. Upon the failure of any
employer to deduct the amount of such taxes or to pay the same over
to the collector, less the cost of bookkeeping involved in such transaction,
as herein provided, within the time hereby required, the employer
shall forfeit and pay the amount of such tax for each such taxable
whose taxes are not withheld and paid over, or that are withheld and
not paid over together with a penalty of 10% added thereto, to be
recovered by an action in assumpsit in a suit to be instituted by
the collector, as debts of like amounts are now recoverable, except
that such person shall not have the benefit of any stay of execution
or exemption law. The collector shall not proceed against a spouse
or the spouse's employer until the collector has pursued collection
remedies against the delinquent taxpayer and his employer.
A.
In the event that any tax under this article remains due or unpaid
after the due dates above set forth, the collector may sue the individual
owing the tax 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
Township to levy and collect the tax hereby imposed on any occupation
not within the taxing power of the Township 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 primary purpose of this article is to conform the local
services tax currently imposed to the Local Tax Enabling Act, as amended
and restated by Act 32 of 2008, and to do so within the time frame
required by Act 32. Any prior enactment or part of any prior enactment
conflicting with the provisions of this article is rescinded insofar
as the conflict exists. To the extent the same as any enactment in
force immediately prior to adoption of this article, the provisions
of this article are intended as a continuation of such prior enactment
and not as a new enactment. If this article is declared invalid, any
prior enactment levying a similar tax shall remain in full force and
effect and shall not be affected in any manner by adoption of this
article. The provisions of this article shall not affect any act done
or liability incurred, nor shall such provisions affect any suit or
prosecution pending or to be initiated to enforce any right or penalty
or to punish offense under the authority of any enactment in force
prior to adoption of this article. Subject to the foregoing provisions
of this section, this article shall supersede and repeal on the effective
date any enactment levying a tax on earned income or net profits in
force immediately prior to the effective date.[1]
The tax imposed by this article shall be effective on January
1, 2011, and all calendar years thereafter unless repealed or modified
by ordinance of the Board of Supervisors of East Whiteland Township.
