Tax Reform On Whose Backs

Mary Young wrote the following article last week in the Reading Eagle.

Another proposal to eliminate the school property tax was put on the table this week. I can’t say for sure, but I think it has a better chance of survival than any of its many predecessors. Momentum is building.

Sixty-two co-sponsors have signed on, or seven more than the last version in April 2012 and 35 more than the previous version in February 2011. The 62 include six from Allegheny County, an area that wasn’t too enthused about past proposals.

No Philadelphia lawmakers are on board yet, but some are expected to be soon, because a recent reassessment of property values is driving up tax bills there for a lot of people.

The city also stands to gain tons of money on its 1 percent sales tax surcharge, because the proposal would expand the tax to more items.

The numbers work. The proposal as it now stands would raise the personal income tax to 4.34 percent from 3.07 percent and the sales tax to 7 percent from 6 percent. The income tax was bumped up a little from the 2012 proposal after an Independent Fiscal Office study confirmed suspicions that the previous version came up short of fully funding public education.

These tax increases would be far less painful than the property tax because workers would pay only about 1.25 cents more in income tax out of each dollar they earn, and everyone would pay just one penny more in sales tax for every $1 they spend.

People and businesses would have more disposable income to spend and help stimulate the state’s economy, and would make the state more attractive as a location for new business and expansion of existing businesses, according to the IFO study.

The total number of taxpayer groups supporting the proposal now stands at 76, an increase of five since last year.

The Reading Eagle’s informal poll about the latest proposal drew 1,666 responses, with 89 percent in favor.

And, during a visit to Reading last week, Lt. Gov. Jim Cawley said he and Gov. Tom Corbett are well aware that the school tax is based on the antiquated notion that a person who owns property has lots of money, and that they would support a change as long as the ultimate result would raise all the money needed for education.

Corbett also is now on the record as saying he would sign a law eliminating the school tax if one should reach his desk.

Contact Mary Young: 610-478-6292 or myoung@readingeagle.com.

As I have written before this is NOT the elimination of the property tax but as Mary Young does point out only the school property tax.  Yes, I know that that IS the largest portion of the property tax.  I also know when the businesses get their windfall they are going to take the profits and run!  Reinvest in this down economy …… BULL.

I have several other points that need to be made.

1)  How much money is Berks County going to lose in this deal?  I know you don’t understand the question so let me rephrase it.  If the money goes to a central pot in Harrisburg to be divided among the school districts, how much of the money collected from Berks County will not be returned to Berks County?  Right now all the money collected in Berks stays in Berks!!!!!  Our money finances our schools.  I find that to be a good concept for our young people in school.  We also may take funding cuts on top of everything else as we have in the last two years.  Does the fact that the bill says funding is to remain level really mean anything?  Not to Governor Gasbag, who will do what he wants like he has tried with the lottery and liquor stores.  As an aside I understand the most recent bill pertaining to the sale of the liquor stores no longer guarantees the money will go to education! In the words of Gomer Pyle “SURPRISE, SURPRISE, SURPRISE!”

2)  Regardless of how much the amount is, the support for this comes on the backs of the individuals and goes away from the businesses.  Yes another tax break for the richest of the population.  Believe it or not the business owner is more wealthy in most cases than the non-business owner.  No not in all cases is this true but in more cases than not!!!

3)  People when they realize they have been had (and they will feel that way because the property tax will still be there) are going to be really upset with those governing the state! Now for those of you that may have aspirations of running for house or senate seats this may not be bad.

Now let’s look at this proposal and think about it.  The sales tax goes up and those of us that struggle the most have to pay more both on things already taxed and newly taxed items while businesses get a tax break and increased profits.

On top of this those of us that work and earn money as wages and salaries will have to pay more in income tax again while those same businesses are enjoying the luxury of a tax break.  You say those businesses will reinvest in their businesses. I say BULL they will take the money and sit on it. All of this cost the kids in our schools educational dollars.

The last thing I want to say this time on this subject is the better the educational system the less we need to invest in prisons.    

Gasbag’s at it again!

As I haven’t written often but always in conjunction with education/school taxes, I really felt the need to write on this. I am on Gov. Gasbags email list from the days of the former governor.  Today I received an email tying the sale of the liquor stores to education.  The Gov. is saying he will “Invest in education by getting Pennsylvania out of the Liquor Business”  He unveiled a plan yesterday to invest $1 Billion in education. No where in the email does it say “Public” education.  So what are we talking about Gov.?  It does say a four year grant program would be enacted for PA schools.  Which schools, Gov.?  The ones that the owners are also going to be contributors to your re-election bid?  He is also going to do away with more PA middle income jobs! I have included the email for you to read.

From the Governor:

Investing in Education by Getting Pennsylvania out of the Liquor Business

Yesterday, Governor Corbett unveiled his plan to invest $1 billion dollars in education by getting Pennsylvania out of the liquor business. Here are the six things you need to know:

1. Under the Governor’s plan, the entire Pennsylvania liquor retail and wholesale system will be run by private entrepreneurs.

2. Once the Governor’s plan is enacted, privatization proceeds will fund a four year, $1 billion grant program for PA schools.

3. The plan expands convenience and choice for Pennsylvanians.

4. The Governor’s plan makes it possible for the creation of a one stop retail shop where Pennsylvanians can buy wine, beer, and liquor.

5. You will be able to purchase six packs of beer and bottles of wine in the same place you purchase groceries.

6. The Governor’s plan enhances enforcement of liquor laws by significantly increasing fines for selling to minors and visibly intoxicated patrons, and proposes a 75 percent funding increase for alcohol treatment and prevention efforts.

The liquor store system provides an on going income source for Pennsylvania that would disappear if the Gov privatizes the system.  If the other items are things he and other want, like different purchase abilities etc. those things can be done without selling this income producing entity. In addition what happens to the school grant funding after that?  Are we selling the PUBLIC a bill of goods again as well as the children in the schools that will be getting these grants?  What funding options will there be after the money runs out, that was produced by the sale of the liquor stores? The people in NJ that are in the government have also said the sale of their system years ago caused other income issues because they had to wait for the taxes to be paid.  With the state owned system the taxes that are collected from the customers are paid to the state on a daily basis as the proceeds get deposit from each store everyday!  Let us not be so SHORT SIGHTED.  It is about more than choices. It is about the financial future of Pennsylvania!!!!

Just a Little More On Tax Reform!

In today’s (Sunday October 7, 2012)  Reading Eagle there is a letter to the editor from Erik Saar candidate for the House of Representatives in the 129th District.  He refers to Representative Cox’s latest bill for property tax elimination as being more than $2 billion short of funding schools statewide.  I find it interesting that the person that originally started this movement also did not have good numbers for the funding issue.  That person was former Representative Sam Rohrer and Representative Cox’s former BOSS.  Yes that right Jim Cox’s former boss.  NOW maybe some of you reading this know where Rep. Cox got this “fantastic” in his opinion idea.  The one question I have for both Mr Saar and Rep Cox is “Does this funding formula now cover the currently funded items by the sales tax?”.  I KNOW it didn’t in the Rohrer days.  I talked to Sam personally about his bills on numerous occasions and everytime I asked that question I got the runaround for an answer. I have a friend the has a PhD in statistical analysis and his comment to me was in order to cover the current items funded and the school funding, we would need an 11% sales tax. Currently funded items at 6% and school funding at 5% or more depending on the funding formula and base amount given to education!  I very much agree with Mr Saar in the fact that the state legislature as a whole missed the boat on the non action on the Marcellus shale situation.  Most of the states that have this kind of issue also tax the extraction instead of giving big oil and gas companies more of a financial windfall.  I personally know people from those areas that have had roads and more destroyed by the massive influx of trucks on roads not built to handle that kind of traffic and will leave with the cleanup left to the municipalities. SHAME on PA for allowing this to happen!  Back to the property tax!  The last thing to say at this moment is it may really be time for a constitutional convention to change the equal taxation provision and also put in a requirement that the state be responsible for at least a 50% funding of “public” schools and/or schools created by public schools and held to the same accountability standards.  Even under the Rendell administration the average school district funding was 38%.  That includes funding for major urban districts like Reading that was receiving 80% state funding and larger ones I am sure were also receiving similar percentages.  With that being the case, one can only guess what some districts in PA were receiving.  If the state is forced to tax for that 50% then we the people in our property tax would not be forced to pay the lions share of school funding. BTW is everyone reading this aware that the only property tax being talked about for elimination in those bills was the school property tax. Your county adn local municipality property tax would remain!!!!

Charter Reform: James Roebuck’s Common Sense Reforms for Greater Charter School Accountability

Keystone Politics Blog Posted on October 3, 2012 by Jon #

I’m more pro-charter schools than I would guess the median KP reader is, but one thing I think PA’s charter skeptics are absolutely right about is the lack of accountability. The key virtue of a liberal regulatory approach to charters is supposed to be that we let charters experiment with different education approaches, and then public schools rip off the best stuff they come up with. Under the current regulations though, they’re just kind of a black hole of unaccountability, and not only can’t we measure whether or not their approaches are working, we can’t even see what they’re doing with the public money they get. It’s like the worst of all worlds.

http://www.keystonepolitics.co…

POSTED with permission of Larry Feinberg  

Property Tax Issues

( – promoted by John Morgan)

There have been many bills over the years trying to rid this state of its property tax.  None to date have been passed into law. I believe that is a great thing. NO not because I was a school board member that levied property taxes but because there is more behind it than the property tax you and I pay on our houses.

Let’s look at this from two view points. The first is a way to eliminate the property tax and be FAIR to everyone!  Make every parent pay the cost of education of their child(ren) as they go.  That is at the state average of $10,000.00 per year per child. Hold on a minute! We can’t do that the state constitution says that the state must provide that education. But let’s go into this just a little. As the system is right now we have a 13 year education system, K-12.  If it costs that $10,000 per year that’s $130,000 for each child that we get as an interest FREE loan.  That’s right, interest free.  If you have 2 children and the average is 2.4 currently that $260,000 to educate your children.  At your current property tax rate (because both the cost and the tax rate will continue to rise over time) how long will it take you to pay off that “loan”.

The second side of this is with the current system the old adage it takes a village to raise a child, really does come into play.  Right now the businesses in your school district also pay property taxes and this is the only tax they cannot get out of in some form.  They can pay executives more money to get out of paying hire income or profits based taxes, but not the property tax. So guess what happens if these bills get passed?  That’s right the businesses get a windfall as they would no longer pay their property taxes and would NOT, by any of the bills introduced so far, be forced to give the lost tax expense back to the public!  Yea they are at it again.  Businesses pay lower taxes on the backs of everyone else!  Businesses would not pay the personal income tax we would.  Businesses do not pay the sales tax we do!

I’m sorry I don’t want to go to a system of individuals paying for the school system alone!  Let’s let the village help to raise the children.  Who benefits through all this but the businesses when the students graduate and are able to be employed in those very businesses!

Let’s force the STATE to pay their fair share on an on going basis and then our property taxes will not be out of site!  In the last two years the state has reduced funding back to the 2006-2007 school year if I am correct.

HOW WOULD YOUR FINANCES BE IF A LARGE PERCENTAGE OF YOUR INCOME WAS TAKEN BACK THAT FAR?