Pennsylvania 2025-2026 Regular Session

Pennsylvania Senate Bill SB962

Introduced

7/31/25

Refer

7/31/25

Caption

Eliminating school district property taxes; imposing county and school district taxes; establishing the School District Emergency Fund and the School District Property Tax Elimination Fund; consolidating Articles II and III of the Tax Reform Code of 1971; in preliminary provisions relating to sales and use tax, providing for definitions; in taxation generally relating to sales and use tax, providing for exclusions and for transfer to county sales and use tax accounts; in preliminary provisions relating to personal income tax, providing for definitions; and making repeals.

Impact

The impact of SB962 on state laws would be significant, as it seeks to fundamentally alter the current education funding model reliant on property taxes, which many see as regressive and unresponsive to the ability to pay. The bill highlights concerns about the sustainability of property tax increases and aims to provide a more equitable method of funding public education that would also consider the financial burdens faced by families and seniors living on fixed incomes. Opponents, however, argue that it may place additional financial pressures on lower-income families through increased sales taxes.

Summary

Senate Bill 962, also referred to as the School Property Tax Elimination Act, is a legislative proposal aimed at eliminating school district property taxes in Pennsylvania. The bill intends to replace the funding currently raised through property taxes with increased sales and income taxes. Specifically, it seeks to implement a new 2% tax on certain goods, the revenue from which will be used to finance school districts. Additionally, the bill includes provisions for the establishment of the School District Emergency Fund and the School District Property Tax Elimination Fund to support this transition.

Sentiment

The sentiment surrounding SB962 appears mixed. Proponents advocate for the reform as a necessary step towards creating a fairer tax structure that does not disproportionately burden property owners. They argue that the transition to a sales tax-based funding system is a more equitable approach. Conversely, critics express concerns about the potential complexity of the new tax structures and the adequacy of funding for schools, fearing that the shift may not sufficiently meet educational needs, particularly in underprivileged districts.

Contention

Notable points of contention within the debate over SB962 include the proposed new income tax on residents, which could affect retirees and lower-income individuals. There are worries about whether the increased sales taxes would offset the elimination of property taxes, particularly for vulnerable populations. Additionally, there are apprehensions regarding the administrative challenges and the timeframe for implementing these changes, especially concerning the establishment of the new funds intended to replace lost property revenue while ensuring that school funding remains stable and adequate.

Companion Bills

No companion bills found.

Previously Filed As

PA HB178

In preliminary provisions, further providing for definitions; and, in taxation by school districts, further providing for school district tax notices.

PA HB1670

Providing for optional property tax elimination; and, in collection of delinquent taxes, further providing for definitions and providing for primary residence.

PA HB895

In taxation by school districts, repealing provisions relating to local tax study commission and to adoption of further referendum.

PA HB167

In sales and use tax, further providing for definitions and for exclusions from tax.

PA HB598

In taxation by school districts, further providing for public referendum requirements for increasing certain taxes.

PA HB410

In preliminary provisions, further providing for definitions; in safe schools, establishing the School Student Mental Health Assistance Augmentation Account; and making a repeal.

PA HB910

In sales and use tax, further providing for definitions and for exclusions from tax.

PA HB164

In sales and use tax, further providing for definitions, for imposition of tax and for exclusions from tax; and, in gross receipts tax, further providing for imposition of tax.

PA HB1536

In sales and use tax, further providing for definitions and for exclusions from tax.

PA HB1708

In preliminary provisions, further providing for definitions; in pupils and attendance, providing for educational oversight for students in facilities, further providing for possession of weapons prohibited and providing for school stability for certain students; in safe schools, further providing for definitions and for reporting and establishing the School-Based Diversion Programs Fund; in school security, further providing for powers and duties and providing for limitations on proceedings and arrest; and, in school districts of the first class, repealing provisions relating to placement of certain adjudicated students.

Similar Bills

No similar bills found.