Section 6-689 - Payroll tax.(a) A school district may levy a payroll tax in accordance with section 303 of the act of December 31, 1965 ( P.L. 1257, No.511), known as "The Local Tax Enabling Act," if the following apply:(1) Each municipality within the school district levies a payroll tax pursuant to section 123(c) and (d) of the act of July 10, 1987 ( P.L. 246, No.47), known as the "Municipalities Financial Recovery Act."(2) The school district levied a mercantile or business privilege tax on a flat rate or millage basis in the year that the municipality filed a petition to levy a payroll tax pursuant to section 123(c) of the "Municipalities Financial Recovery Act."(b) The following shall apply: (1) The tax authorized under subsection (a) may be imposed at a rate not to exceed a rate sufficient to produce revenues equal to revenues collected from the levy of a mercantile or business privilege tax by the school district under chapter 3 of "The Local Tax Enabling Act" in the last full fiscal year preceding the levy of the payroll tax. A school district shall not be required to begin the levy of the payroll tax on the first day of the fiscal year. Except as provided under clause (2), a school district may levy a payroll tax in any subsequent year at a rate not to exceed the rate initially authorized under this clause.(2) In the event that the rate imposed under clause (1) fails to produce the revenues projected in the first full year of the collection of a payroll tax, a school district may amend the rate imposed not to exceed a rate that is sufficient to produce revenues equal to the revenues collected as a result of the mercantile or business privilege tax in the final full fiscal year it was levied. A school district may levy the payroll tax in any subsequent year at a rate not to exceed the adjusted rate authorized under this clause.(c) After imposing a payroll tax under this section, the authority of a school district to continue to levy the payroll tax is not contingent on the decision to levy a payroll tax by a municipality within the school district.(d) A school district which levies a payroll tax under this section may not thereafter levy a mercantile or business privilege tax.(d.1) Notwithstanding section 333 of the Act of June 27, 2006 (1st Sp.Sess., P.L. 1873, No.1), known as the "Taxpayer Relief Act," or any other provision of law to the contrary, a school district shall not be subject to a referendum requirement as a condition to impose the levy of a payroll tax under this section.(e) As used in this section, the following words and phrases shall have the meanings given to them in this subsection unless the context clearly indicates otherwise: "School district." A school district coterminous with a home rule municipality that is a city of the second class A located within a home rule county of the third class.
Amended by P.L. TBD 2020 No. 30, § 5, eff. 7/6/2020.Added by P.L. 716 2016 No. 86, § 1, eff. 7/13/2016.