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The Pennsylvania Association of Realtors® is committed to real property tax reform in the Commonwealth. PAR commissioned Anderson Economic Group to review the impact of Gov. Wolf’s proposed budget on taxpayers and housing. While the budget proposal provides property tax relief and similarly increases sales and income taxes, it does not result in the same limitations on school district’s ability to increase property taxes. There is a net increase in taxes due to the tax changes of $3 billion. The changes could result in an increase in home values by 3 percent to 5 percent on average. PAR continues its commitment to property tax elimination as found in last session’s Senate Bill 76.
The state House, in a bi-partisan vote of 105-86, passed House Bill 504 and sent it to the Senate in May. This bill proposes to shift taxes and when fully implemented would raise state income and sales taxes to lower school property tax bills by $4.2 billion in the first year of full implementation. The plan is estimated to provide between 37 and 70 percent reduction in residential school property tax bills. Commercial property owners would see some tax relief as well. The bill proposed to raise the state's 3.07 percent personal income tax to 3.7 percent and the state's 6 percent sales tax to 7 percent but doesn't change the base of items subject to the tax.