[Adopted 4-18-1966 by Ord. No. 307; amended
in its entirety 11-20-2007 by Ord. No. 651]
This Article II shall be known and may be cited as "The Borough of Palmerton Local Services Tax Ordinance."
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 Palmerton.
The person, public employee or private agency designated
by the Borough of Palmerton to collect and administer the tax herein
imposed.
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 (P.L. 6, No. 2) (72 P.S. § 7303), 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 Palmerton.
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) (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:
[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, carried
on or performed within the corporate limits of the Borough of Palmerton,
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 § 115-14 of this article.
The period from January 1 until December 31 in any year;
a calendar year.
A.
For specific revenue purposes, an annual tax is hereby
levied and assessed, commencing January 1, 2008, upon the privilege
of engaging in an occupation with the primary place of employment
within the Borough of Palmerton 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.
B.
This tax may be used solely for the following purposes
as the same may be allocated by the Borough Council from time to time:
C.
The Borough shall use no less than 25% of the funds
derived from the tax for emergency services.
D.
This tax is in addition to all other taxes of any
kind or nature heretofore levied by the Borough of Palmerton.
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.
A.
Exemption. Any person whose total earned income or
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 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)
A person seeking to claim an exemption from the local services tax shall 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.
(2)
With respect to a person who claimed an exemption from the tax for a given calendar year, 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 from the tax for a given calendar year 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 Borough may pursue collection under this article.
C.
Refunds. The Borough Manager, 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. (With respect to refunds, see 53 Pa.C.S.A.
§ 8425; with respect to interest, see 53 Pa.C.S.A. § 8426.)
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 Manager or the Collector shall
determine eligibility for refunds to exempt persons and provide refunds.
A.
Each employer within the Borough of Palmerton, as
well as those employers situated outside the Borough of Palmerton
but who engage in business within the Borough of Palmerton, is hereby
charged with the duty of collecting the tax from each of his employees
engaged by him or performing for him within the Borough of Palmerton
and making a return and payment thereof to the Collector. Further,
each employer is hereby authorized to deduct this tax from each employee
in his employ, whether said employee is paid by salary, wage or commission
and whether or not all such services are performed within the Borough
of Palmerton.
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 combined 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 1/100 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 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 Subsection B of § 115-15 of this article and this subsection 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 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
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 with the Borough of Palmerton 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 that the person 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 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 the Borough of
Palmerton, but who perform services of any type or kind or engage
in any occupation or profession within the Borough of Palmerton, 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 Palmerton. Further, any individual engaged in an occupation
within the Borough of Palmerton 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 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 Council. 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 to the Court
of Common Pleas of Carbon 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 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.
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
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 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 shall be guilty of a violation and, upon conviction thereof, shall be sentenced to pay a fine as provided in Chapter 1, General Provisions, Article II, § 1-17A and B. 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 Palmerton 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 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.
Except as set forth hereafter, all ordinances
or parts of ordinances inconsistent herewith are hereby repealed.
Nothing herein shall be construed to repeal the imposition and collection
of an occupation privilege tax, plus applicable penalties and interest,
for the calendar year 2005 and all prior years, or of an emergency
and municipal services tax for the calendar years 2006 and 2007, as
the same existed prior to the amendment.
The tax imposed by this article shall be effective
on January 1, 2008, and all calendar years thereafter unless repealed
or modified by ordinance of the Borough Council.
In all other respects, Chapter 115, Taxation, of the Code of the Borough of Palmerton shall remain as heretofore enacted, ordained and amended, which said chapter, as amended, is hereby reenacted in its entirety herein.
[Added at time of adoption of Code (see Ch. 1, General Provisions,
Art. I)]
The local services tax is enacted under the authority of the
Local Tax Enabling Act, 53 P.S. § 6924.101 et seq.
