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Association News, Government AffairsRendell proposes taxing all non-essential services in 2010-11 budget
Pennsylvania Gov. Ed Rendell today outlined the details of his 2010-11 General Fund $29 billion budget which includes a proposal to lower the state tax rate from six percent to four percent and to tax all non-essential services, including REALTOR® fees.
Gov. Ed Rendell
“It (the budget) reflects the rising cost of our mandated obligations, yet it is still $2 billion less than the budget approved by this Legislature two years ago,” he said.
Rendell proposed creating the Stimulus Transition Reserve Fund, a strategy to help the state save money now to help protect and preserve the fiscal stability of the Commonwealth. “A fiscal tsunami is coming at us and I believe we must act now to mitigate its impact,” he said.
The strategy calls for these changes to the state tax system:
- Reduce the state sales tax from six percent to four percent
- Eliminate 74 non-essential exemptions to state sales tax
- Tax cigars and smokeless tobacco
- Tax Marcellus Shale extractions
- Stop bonuses given to businesses for paying taxes on time
- Close the tax loophole for companies located outside the state that have a significant presence within Pennsylvania but pay no state tax.
Rendell said by reducing the state sales tax and broadening the base, the “proposal will cut the sales tax statewide for every Pennsylvanian by one third.”
The governor also called on the Legislature to cap campaign expenditures and to put stricter controls on reports from political action committees.
PAR will continue to monitor the budget process.
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Kim Shindle is the Manager of Media Relations at the Pennsylvania Association of Realtors®. |
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Hey everyone,
I’ve heard from 2 sources last week (as well as Ellen Cassidy) that it “currently appears” that we WILL NOT be affected – or that certain portions of this legislation will be “omitted”.
Has anyone heard similar?? Harry…, Pat??
I am outraged. We deserve some respect. We, as realtors, already are burdened by vaious entity businesses siphoning our commissions. We work hard in a thriving economy and we work hard in a down economy….only with drastic income reductions. And now Rendell wants to put more hands in our pockets. I say “NO”. This is unfair. Period.
It is time for Ed Rendell to get out of the government. This guy is going to tax every business out of Pa. When is the government going to stop spending so much of our money. I would like to see taxes raised on all govt. employees only.
Thanks for the list. If anyone takes a minute to review this list it certainly will not be saving taxpayers any money at all. With the cap off electric and prices already increasing we will pay an additional 4% tax on all the taxes we already pay for electric and now fuel oil too? Hopefully they will be keeping the programs going that help people with their utilities becuase more will definitely be needing it now. Keep taxes all of us to the point of having nothing to spend not even for necessities wil certainly not help the economy to come out of where we are. If no one has a dime after taxes to spend we’ll just see more of our small business closing their doors that they already are at an even more alarming speed.
February 13, 2009
I have been a tax paying citizen for many, many years. I have never seen a tax revision that did not result in costing the citizen more money. Usually, tax changes and revisions always result in less disposal income. Unfortunately, a cloak and dager approach is not the answer. I am dissapointed and depressed to see that the people who have the ability to work and earn money to help stimulate the economy by spending it are penalized. Regressive tax burdens results in less productivity. If the services are non-essential why tax these services?
HarryMcCarty16@msn.com
Hi, thanks for this article. I assume these proposed new taxes would be passed along to the consumer, but I am not clear how this would work in the case of a real estate commission. Would the seller who is paying a broker 6% commission (or whatever amount) also pay a 4% sales tax on that figure? Or would this new tax be split equally betweeen buyer and seller, like with transfer tax?
Unbelievable! A premium tax of 4% on income that I already pay taxes on – are you kidding me?!?! As independent contractors, we have no safety net as it is. How about supporting us as the small business owners we are? If there’s ever been a time for the real estate community to band together and take action, it’s now. Time to get mad people…
Thanks, Kim, for the link to the list! Certainly won’t save the taxpayers any money with all these current exemptions being taxed! Now is the time Government should be cutting back on taxes to stimulate the economy – not adding more!
Pat,
Here’s a link to the 74 non-essential exemptions.
http://www.scribd.com/doc/26624951/74-Tax-Exemptions-to-Be-Repealed-020910
What are those 74 non-essential exemptions?