[Adopted 12-3-2007 by Ord. No. 4-2007[1] (Ch. 122, Art. VI, of the 1985 Code)]
[1]
Editor's Note: This ordinance also repealed former Art. VI,
originally adopted 11-3-1997 by Ord. No. 3-1997, approved 11-3-1997,
as the Occupational Privilege Tax, and subsequently amended in its
entirety 12-5-2005 by Ord. No. 9-2005 as the Emergency and Municipal
Services Tax.
The following words and phrases when used in this article shall
have the meanings ascribed to them herein except where the context
clearly indicates or requires a different meaning:
The governing body of Spring Grove Borough.
The person or firm, from time to time, designated by motion
of the Borough Council of Spring Grove Borough to collect and administer
the provisions of this article and collect the tax levied by this
article. Until changed by subsequent motion, the Collector shall be
the same person or firm last designated to collect the emergency and
municipal services tax for Spring Grove Borough.
The aggregate annual rate of the local services tax levied
by the Spring Grove Area School District and Spring Grove Borough
located in whole or in part within jurisdictional limits of the Spring
Grove Area School District.
Compensation as determined under Section 303 of the Act of
March 4, 1971 (P.L. 6, No. 2), known as the "Tax Reform Code of 1971,"[1] and regulations in 61 Pa. Code Pt. I, Subpt. B, Art. V (relating to personal income tax), not including, however, wages or compensation paid to individuals on active military service. Employee business expenses are allowable deductions as determined under Article III of the Tax Reform Code of 1971. Any housing allowance provided to a member of the clergy shall not be taxable as earned income.
An individual, partnership, association, corporation, governmental
body, agency or other entity employing one or more persons on a salary,
wage, commission, fee or other compensation basis, including a self-employed
person.
Includes singular and plural number and male, female and
neuter gender.
Any person engaged in any occupation, trade or profession
within the jurisdictional limits of Spring Grove Borough.
The net income from the operation of a business, profession,
or other activity, (except from corporations), determined under section
303 of the Act of March 4, 1971 (P.L. 6, No. 2), known as the "Tax
Reform Code of 1971,"[2] and regulations in 61 Pa. Code Pt. 1, Subpt. B, Art. V
(relating to personal income tax). The term does not include income
which is not paid for services provided and which is in the nature
of earnings from an investment. For taxpayers engaged in the business,
profession or activity of farming, the term shall not include:
Any interest generated from monetary accounts or investment
instruments of the farming business;
Any gain on the sale of farming machinery;
Any gain on the sale of livestock held 12 months or more for
draft, breeding or dairy purposes; and
Any gain on the sale of other capital assets of the farm.
Any trade, profession, business or undertaking of any type,
kind or character including services, domestic or other, carried on
or performed within the jurisdictional limits of Spring Grove Borough
for which compensation is charged and/or received, whether by salary,
wages, commissions, fees or net profits for services rendered.
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.
The local services tax levied in this article.
A calendar year.
A.
Spring Grove Borough hereby levies and imposes on every individual
engaging in an occupation within the jurisdictional limits of Spring
Grove Borough a tax in the amount of $52 per annum, beginning the
1st day of January 2008 and continuing on a calendar basis annually
thereafter, until modified or repealed by subsequent ordinance. This
tax is in addition to all other taxes of any kind or nature heretofore
levied by Spring Grove Borough.
B.
Spring Grove Borough shall use the revenue derived from this tax
for the following purposes; provided, however, that no less than 25%
of the funds derived from this tax shall be used for emergency services,
as defined herein:
A.
Each employer within Spring Grove Borough and each employer situate
outside Spring Grove Borough who engages in business within Spring
Grove Borough is hereby charged with the duty of collecting the tax
from each of the employees engaged by the employer and performing
work for the employer within Spring Grove Borough. Each person subject
to the tax shall be assessed a pro rata share of the tax for each
payroll period in which the person is engaging in an occupation.
B.
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 local
services 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.
C.
Employer collection of the local services tax shall be made on a
payroll-period basis for each payroll period, beginning with the first
payroll period in which the person is engaging in an occupation.
D.
No employer shall be held liable for failure to withhold the local
services tax or for the payment of the withheld tax money to Spring
Grove 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.
Employers are required to make and file a local services tax
quarterly return 30 days after the end of each quarter of a calendar
year. The local services tax quarterly return shall list the name,
address, and social security number of the employee; the physical
address of the employee's place of employment; the number of payroll
periods for which the local services tax was withheld; and the amount
of local services tax being remitted for each employee.
Each employer shall use his employment and payroll records from
the first day of January to March 31 each year for determining the
number of employees from whom said tax shall be deducted and paid
over to the Collector on or before April 30 of the same calendar year.
Supplemental reports shall be made by each employer on July 30, October
30 and January 31 for new employees as reflected on his employment
and payroll records from April 1 to June 30, July 1 to September 30
and October 1 to December 31, and payments on these supplemental reports
shall be made on July 30, October 30 and January 30, respectively.
A.
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 the payroll
period, the priority of claim to collect the local services tax shall
be in the following order:
(1)
The political subdivision in which a person maintains his or her
principal office or is principally employed;
(2)
The political subdivision in which the person resides and works,
if the tax is levied by that political subdivision;
(3)
The political subdivision in which a person is employed and which
imposes the tax nearest in miles to the person's home.
B.
In the case of concurrent employment, an employer shall refrain from
withholding the local services tax if the employee provides:
(1)
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 local services tax withheld; and
(2)
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.
C.
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.
It is the intent of this section that no person shall be subject to
the payment of the local services tax by more than one political subdivision
during each payroll period.
A.
The local services 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.
B.
The Local Tax Enabling Act, as amended,[1] requires municipalities and school districts who levy
the local services tax at a combined rate exceeding $10 to exempt
any person from the local services tax whose total earned income and
net profits from all sources within Spring Grove Borough is less than
$12,000 for the calendar year in which the local services tax is levied.
Each political subdivision levying the local services tax hereby exempts
the following persons from the local services tax:
(1)
Any person whose total earned income and net profits from all sources
within Spring Grove Borough is less than $12,000 for the calendar
year in which the local services tax is levied.
(2)
Any person who 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-permanent
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. A "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.
[1]
Editor's Note: See 53 P.S. § 6924.101 et seq.
C.
A person seeking to claim an exemption from the local services tax
must annually file an exemption certificate with the Collector of
the tax for the political subdivision levying the tax and file a copy
of the certificate with the person's employer affirming that the person
reasonably expects to receive earned income and net profits from all
sources within Spring Grove Borough of less than $12,000 in the calendar
year for which the exemption certificate is filed. The exemption certificate
shall have attached to it a copy of all of the employee's last pay
stubs or W-2 forms from employment within Spring Grove Borough for
the year prior to the fiscal year for which the employee is requesting
to be exempted from the local services tax.
D.
Upon receipt of the exemption certificate and until otherwise instructed
by the Collector of the tax for Spring Grove Borough, the employer
shall not withhold the tax from the person during the calendar year
or remainder of the calendar year for which the exemption certificate
applies. With respect to a person who claimed an exemption from the
local services tax, upon notification to an employer by the person
or by the Collector of the tax for Spring Grove Borough that the person
has received earned income and net profits from all sources within
Spring Grove 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 Spring Grove 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 as follows:
(1)
If a person who claimed an exemption for a given calendar year from
the local services tax becomes subject to the tax for the calendar
year, the employer shall withhold the tax for the remainder of that
calendar year.
(2)
The employer shall withhold from the person, for the first payroll
period after receipt of the notification under the above paragraph,
a lump sum equal to the amount of the tax that was not withheld from
the person due to the exemption certificate filed by the person, plus
the per-payroll amount due for that first payroll period.
(3)
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.
E.
In the event the employment of a person subject to withholding of
the local services tax under this exception is severed in that calendar
year, the person shall be liable for any outstanding balance of tax
due and Spring Grove Borough may pursue collection under this article.
F.
Except as provided for in Subdivision D above, employers shall not
be responsible for investigating exemption certificates, monitoring
tax exemption eligibility or exempting any employee from a local services
tax.
G.
Employers shall be responsible for retaining a copy of all exemption
certificates filed by employees within a given calendar year for a
minimum of three years. Employers who have failed to withhold the
local services tax from an employee or employees, and do not have
copies of the employee exemption certificate or certificates, will
be held responsible for the payment of the local services tax as if
the tax had been originally levied against the employer.
All self-employed individuals and individuals whose employer
is not required to withhold local taxes (certain state and federal
agencies) will be billed quarterly for the local services tax. The
full amount of tax must be paid by the date indicated on such billing.
If such taxpayer qualifies for a low-income exemption, the taxpayer
may complete the required exemption certificate or make application
for a refund of the tax paid.
All employers and self-employed individuals residing or having
their place of business outside Spring Grove Borough but who engage
in any occupation within Spring Grove 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 Spring Grove Borough.
Further, any individual engaged in an occupation within Spring Grove
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
this tax is not paid, the Collector shall have the option of proceeding
against either the employer or employee for collection of this tax
as hereinafter provided.
A.
It shall be the duty of the Collector to accept and receive payments
of this tax and 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. It shall be the duty of the Collector to
accept and keep a record of the information submitted by employers
relating to the number of employees subject to the tax, the number
of employees exempt from the tax, the employee exemption certificates
and refunds of the tax paid to individuals and employers. It further
shall be the duty of the Collector, on behalf of Spring Grove Borough,
to provide a taxpayer a receipt of payment upon written request of
the taxpayer.
B.
The Collector is hereby charged with the administration and enforcement
of this article and is hereby empowered to prescribe, adopt, promulgate
and enforce rules and regulations relating to any matter pertaining
to the administration and enforcement of this article, including provisions
for the examination of the 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 York
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 any of the tax under this article remains due or unpaid
30 days after the due date set forth above, the Collector may sue
for the recovery of such tax due or unpaid 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 said tax and an additional penalty
of 10% shall be added to the flat rate of said tax for nonpayment
thereof. 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, but not limited to, attorney's
fees.
Whoever 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 in order to determine the number
of employees subject to this tax who are in his employment, or who
fails or refuses to file any return required by this article, or fails
or refuses to pay the tax herein levied shall, upon conviction, be
sentenced to pay a fine of not more than $600 plus costs and, in default
of payment of said fine and costs, be sentenced to a term of imprisonment
not to exceed 30 days. It is further provided that the action to enforce
the fine and penalty herein provided may be instituted against any
person in charge of the business of any employer who has failed or
refused to file a return required by this article.
A.
Refunds are to be paid within 75 days of a refund request or 75 days
after the last day the employer is required to remit the local services
tax for the last quarter of the calendar year, under Section 9 of
Act 7, whichever is later and shall not be subject to interest if
paid within the allowed time.
B.
Refunds shall only be provided for amounts overpaid in a calendar
year that exceed $1.
C.
Refund due to duplication of payment. If at any time during the calendar
year a taxpayer pays more than $52 in combined LST, the taxpayer may
apply for a refund of the amount over $52. The proper refund request
form must be completed and signed by the taxpayer and necessary documentation
must be included. These refunds may be processed at the time they
are received, unless there is reason to believe we will not receive
the tax from the employer.
D.
When an individual's earned income and net profits only for the calendar
year is less than the $12,000 exemption at the end of the calendar
year, any taxpayer who qualifies may complete a refund application
and include a copy of the necessary documentation.
