Tuesday, October 25, 2005

'Tea Party' rally backs expanded state sales tax

'Tea Party' rally backs expanded state sales tax

Tuesday, October 25, 2005

BY CHARLES THOMPSON Of The Patriot-News

Chuck Warner said he received a good raise when he accepted a Tyco Electronics transfer from North Carolina to his native Pennsylvania. Then he got his school tax bill.

"My entire raise got eaten up by property taxes," said Warner, 40, a manufacturing engineer from York Twp., York County.

Warner and about 300 other citizens -- many bearing tea bags -- staged a "Pennsylvania Tea Party" in the Capitol Rotunda yesterday, demanding passage of a five-bill package that would, at its heart, replace school property taxes with a revamped state sales tax.

The House is expected to vote Nov. 21 on the switch, proposed by Rep. Sam Rohrer, R-Berks County. The proposal would reduce the sales tax rate from 6 percent to 5 percent but broaden it to include food, clothing and many services now exempt.

Rohrer's plan is supported by fiscally conservative lawmakers dubbed the Commonwealth Caucus but has drawn opposition from lawyers, major retailers and food-bank operators.

Opponents argue that the loss of current exemptions would put a 5 percent tax on food, clothing and many services that go untaxed now, creating a significant burden for low-income households. That would be particularly harsh, they say, for renters, who would not benefit directly from a property-tax cut.

House Democrats say that, in addition to food and clothes, Rohrer's plan for the first time would tax flags, aspirin, college tuition and textbooks, diapers, haircuts, heating oil purchases, lawyers' fees, newspapers and veterinary services.

Officials in Gov. Ed Rendell's administration have voiced doubts about whether Rohrer's plan would raise enough money to eliminate property taxes.

Revenue Secretary Greg Fajt said last month that the plan would raise only $5.6 billion of the $10 billion necessary to eliminate school property and so-called nuisance taxes. Fajt said the sales tax rate would have to increase to 6.65 percent to make Rohrer's plan work.

A major theme of yesterday's rally was that property taxes are a bad way of paying for public education.

Joan Falcone, an activist from eastern Berks County, said state subsidies to school districts have fallen behind rising costs, forcing the difference to be covered by local property taxes. That means districts with strong tax-base growth can build new athletic facilities with all the amenities, while those in economically depressed areas must struggle with such decisions as raising taxes or ordering new textbooks.

Act 72, Rendell's plan to provide tax breaks through gambling profits, was booed several times during the rally, and demonstrators carried signs calling for "meaningful tax reform, not a $300 bone."

Rendell's plan has been projected to yield property tax breaks averaging $330 statewide in participating school districts after 14 slots casinos open around the state.

Rohrer said his plan looks good by comparison. Rather than offering a "measly, partial reduction, ... we want to make our people the true owners of their property," he said.

CHARLES THOMPSON: 705-5724 or cthompson@patriot-news.com

©2005 The Patriot-News

Source: http://www.pennlive.com/news/patriotnews/index.ssf?/base/news/113023214952030.xml&coll=1h

Vice Chairman of Voter Education

http://www.ycop.org

http://groups.yahoo.com/group/YCOP/

http://www.InformedPA.com

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