Menu
Tax Notes logo

Pennsylvania Senate Democrats Propose 9-Bill Relief Package

Posted on Apr. 30, 2020

Pennsylvania Senate Democrats are planning a coronavirus relief package that would authorize state stimulus checks, a sales tax amnesty, and tax credits, to be funded in part by the Johnstown Flood tax.

Sen. Lisa Boscola, chair of the Senate Democratic Policy Committee, issued an April 17 memo expressing her intent to file nine bills to provide relief to businesses, individuals, and families hit by the COVID-19 pandemic and the state shutdown.

One bill would establish the Pennsylvania Investment in Economic Stimulus Act, which would distribute a one-time check “at the right time” to help restart the state economy. The act would be funded through any remaining fiscal 2020 funds and all funds earmarked for the Commonwealth Financing Authority for fiscal 2021.

A second bill would mirror S.B. 1113, introduced by Sen. John Blake (D) April 15. Blake's bill would offer a tax credit equal to 100 percent of costs incurred by a business when converting or retrofitting a facility to manufacture personal protective equipment. Boscola’s memo does not include any specifics on the size of the credit for each business, but states that the program would be capped at $50 million.

A third bill would provide a six-month sales tax amnesty for restaurants, bars, and hotels to encourage “a reserved general public” to purchase more. The amnesty period would begin once Democratic Gov. Tom Wolf’s emergency order is lifted.

Pennsylvania brought in $9.6 billion in non-motor-vehicle sales and use taxes in fiscal 2019, according to the state’s Tax Compendium.

Another proposed measure would allow businesses to postpone personal income tax withholdings for the first quarter of fiscal 2021 and remit that amount over the following three quarters.

Boscola also proposed to file legislation to expand and extend the unemployment compensation charge relief authorized under Act 9, signed by Wolf March 27. Under that emergency declaration, employers are relieved of unemployment charges associated with layoffs or furloughs during the pandemic. Boscola’s bill would extend this relief to December 30.

The measures would, in part, be paid for by redistributing revenue generated by the Johnstown Flood tax, an 18 percent excise tax on spirits sold in state liquor stores. The “temporary” tax was instituted after the St. Patrick’s Day Flood of 1936 devastated the town and portions of Pittsburgh. Over the years, the tax increased incrementally and lost its temporary status, and proceeds were diverted to the general fund. The tax generates over $200 million annually.

Seth Rolko, executive director of the policy committee, said the language is still being worked out for the bills and no further details are available.

Senate Republicans did not respond to requests for comment by press time.

Copy RID