Pa. House approves property tax relief

Seniors would benefit from slots revenues.
HARRISBURG, Pa. (AP) - January 29, 2008

The property tax debate was expected to continue Wednesday amid uncertainty about what if anything will finally emerge from the chamber.

The plan that was approved Tuesday, sponsored by veteran Republican floor strategist Rep. John M. Perzel of Philadelphia, would dedicate the billion dollars or more a year that the slots gambling industry is projected to generate to pay the taxes of older Pennsylvanians on 600,000 homes and other properties.

It passed 159-36 but requires another favorable vote to be sent to the Senate.

Majority Leader Bill DeWeese, D-Greene, said the House would next take up a proposal to amend the constitution by ending school districts' authority to levy real estate property taxes in 2010. If passed, it could in turn affect or cancel out Perzel's legislation.

Perzel's amendment includes an age limit of 65 and an income limit for a full tax cut of $40,000. It would not increase any other taxes, unlike the Democratic plan, but it would leave empty-handed about 2.7 million families who would otherwise be on track to get tax relief next year. Perzel disputed predictions his legislation would be vetoed.

"As far as the governor's concerned, if he doesn't like seniors he doesn't like seniors, I can't help that," he said.

Chuck Ardo, a spokesman for Democratic Gov. Ed Rendell, declined comment late Tuesday.

The surprise vote followed the three-to-one defeat of a Republican-sponsored proposal to eliminate all school property taxes - including those on businesses, commercial properties and second homes - by extending the state sales tax to far more transactions and increasing the income tax.

The sponsor of that measure, Rep. Sam Rohrer, R-Berks, called it "the biggest thing this House has ever discussed."

"The school property tax is taking people to their graves, both in their spirit and their will," he said.

Perzel's plan trumped an approach sponsored by Finance Committee Chairman David Levdansky, D-Allegheny, that would have directed tax cuts to all owners of primary residences and farms.

Levdansky proposed adding a half-percentage-point to the state sales tax - to 6.5 percent from the current 6 percent - and increasing the personal income tax by 0.22 percent, to 3.29.

Perzel said his legislation responded to voters' and school boards' rejection in recent years of other property tax reduction schemes.

"The bottom line is, the people of Pennsylvania don't like what we've been doing," he said. "We can realistically take care of the senior homeowners - they're the ones that are most involved, most touched by these taxes."

Levdansky criticized Perzel's approach for creating a tax shelter for others by not limiting eligibility to people's primary residences or farms.

"If this amendment were to become law, I'm going to give my house to my parents," he said. "And not just me, but all property owners who pay property taxes will be encouraged to give their property to their parents if they make less than $40,000."

Perzel's parliamentary maneuver was possible because House rules passed last year granted rank-and-file members the ability to force floor votes on amendments, a rule that was not in place when Perzel served as House majority leader and as speaker.

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