Details of the latest plan to eliminate and replace school property taxes have been finalized and the legislation has been introduced in the Pennsylvania House (follow this link to read the bill).
House Bill 1776, The Property Tax Independence Act, looks in part to the former School Property Tax Elimination Act (SPTEA) for its basic structure. While The Property Tax Independence Act mirrors some of the provisions of the former SPTEA, the plan has been comprehensively rewritten to account for lawmakers’ concerns and preferences in order to eliminate objections common to the previous legislation.
• The Property Tax Independence Act will eliminate school property and local school
nuisance taxes across the Commonwealth and will replace those taxes with funding from a
single state source.
• The Property Tax Independence Act introduces a modernized school funding method that is
based on 21st century economic realities.
• The Property Tax Independence Act uses in great measure our current sales tax
mechanism to fund schools, restoring the original intent of the tax.
• The sales tax provides a predictable and stable funding source that is tied to economic
growth. This is in clear contrast to the school property tax which is not based on economic
growth and is subject to much variation.
• Current school spending regularly exceeds tax revenue and The Property Tax
Independence Act addresses this problem head on by limiting school budget increases to
the rate of inflation.