Legislative Update

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  • Week Ending June 14, 2019

    by PICPA Government Relations | Jun 14, 2019

     


    PICPA Members Make Policy Impact at 18th Day on the Hill

    The PICPA hosted its annual Day on the Hill conference in Harrisburg on June 11. Seventy-four CPAs from across Pennsylvania came to the capital to meet with elected state officials and key policymakers, and to advocate for PICPA’s legislative agenda.

    Following a welcome by Marty Levin, PICPA president, and a legislative briefing from Peter Calcara, vice president of PICPA’s government relations team, members heard from Rep. Matthew Bradford (D-Montgomery), minority chair of the House Appropriations Committee; Sen. Pat Browne, CPA (R-Lehigh), majority chair of the Senate Appropriations Committee; and Joseph Torsella, Pennsylvania treasurer. Updates were provided on state budget deliberations and other topics pending before the General Assembly.

    State Sen. Lisa Boscola (center) with PICPA member visitors.PICPA members then made their way to the Capitol where they participated in 120 meetings with state legislators. Members asked their lawmakers to support tax statute of limitations legislation (House Bill 17), reporting for estates and trusts legislation (House bill 706), and 1099-MISC nonresident withholding legislation (House Bill 926). Members also educated legislators on state tax issues. The PICPA is a strong advocate for certain in-state tax legislation, and aims to raise awareness of proposals that are in accordance with the Guiding Principles of Good Tax Policy.

    Pa. Gov. Wolf with PICPA members Martin Levin and Steve Christian, with PICPA's Jen Cryder and Peter Calacara.In the afternoon, members received an economic and revenue update from Brenda Warburton, deputy director of the Independent Fiscal Office, and participated in a panel discussion with the Pennsylvania Department of Revenue.

    PICPA leaders also met with Gov. Tom Wolf in his office to discuss PICPA’s legislative agenda.

    If you missed Day on the Hill this year, we urge you to visit PICPA’s Facebook page and check out the interviews that were conducted with a number of our speakers.

     

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    House Finance Committee Approves Tax Preparer Oversight Measure

    The state House Finance Committee approved legislation that would require any paid tax preparer to include his or her preparer tax identification number on state income tax returns filed on behalf of another taxpayer. House Bill 1583, sponsored by Rep. Mike Peifer (R-Pike), chair of the House Finance Committee, is now before the full House for consideration.   

    The committee also reported out House Bill 1100 (energy and fertilizer manufacturing tax credit) and House Bill 1103 (pipeline investment grant program).

    All three bills now go to the full House for a vote.

     

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    Bill Expanding School Choice Scholarships Goes to the Governor

    House Speaker Mike Turzai’s House Bill 800, which would expand Pennsylvania’s Educational Improvement Tax Credit (EITC) program with $100 million in additional tax credits for scholarship organizations, is headed to Gov. Wolf. The governor has indicated that he will veto the legislation.

    The bill includes an automatic escalator that would allow the program to grow to meet demand, increasing the funding for these scholarships by 10 percent in any year that 90 percent of the credits are claimed if the General Assembly does not approve a separate increase. It would also increase the household income limit by $10,000. Once a student qualifies, he or she would remain eligible for the program through high school graduation, regardless of changes to family income.

     

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    New Services Help Online Sellers with Pennsylvania Sales Tax

    The Pennsylvania Department of Revenue is making it easier for people and businesses selling products online to collect and remit Pennsylvania sales tax by working with several certified service providers (CSPs), companies that allow out-of-state online sellers to outsource most of their sales tax collection responsibilities.

    CSPs file tax returns and also collect and forward tax payments to the Department of Revenue on behalf of their clients. The four CSPs the department is working with are AccurateTax, Avalara, Sovos, and TaxCloud.

    The software that CSPs offer can help an online seller determine which items they are selling are subject to Pennsylvania sales tax. Under the CSPs’ arrangement with the Department of Revenue, they will offer their services for free or at a reduced cost to online sellers with no physical presence in Pennsylvania. The department launched a new webpage with an overview of the services offered by CSPs.

    The Department of Revenue started working on this initiative after the U.S. Supreme Court issued its June 2018 opinion on South Dakota v. Wayfair. The opinion overturned the court’s previous ruling in Quill Corp. v. North Dakota, which required a business to have a physical presence in a state in order for the business to be required to collect that state’s sales tax.

    Read in conjunction with Pennsylvania’s Tax Reform Code, the Supreme Court’s Wayfair decision case requires out-of-state sellers making $100,000 or more in annual gross sales to Pennsylvania customers to collect and remit Pennsylvania sales tax. This was the threshold suggested in the Wayfair case. This requirement will take effect in Pennsylvania on July 1, 2019.

     

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    Enhanced Revenue Collection Account Made Permanent by House

    House Bill 1232, sponsored by Rep. George Dunbar (R-Westmoreland), to update the Enhanced Revenue Collection Account, passed the House unanimously this week.

    The Enhanced Revenue Collection Account was created in 2010 to fund the Department of Revenue’s expanded tax return review and tax collection activities. Of the amounts received from those activities, the Department of Revenue is permitted to use up to $30 million per year, and the remainder is returned to the General Fund or the appropriate fund in the state treasury. As part of its most recent reauthorization, the account and the $30 million appropriation were extended through the 2019-2020 fiscal year.

    Under this proposal, the account would be made permanent. However, the General Assembly would be required to determine the amount of funding for the Department of Revenue from the account each year. This change will return control over the funding used in this account to the General Assembly for review each year.

    The legislation now goes to the Senate for consideration.

     

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    Brewery Tax Reform Clears House

    The Pennsylvania House passed legislation seeking to address Pennsylvania’s taproom tax. The legislation is in response to a Department of Revenue state tax bulletin that said breweries that bypass wholesalers and sell beer directly to consumers in tasting rooms and retail storefronts would be required to issue the 6% state sales tax at the point of sale.

    House Bill 1549, authored by Rep. Natalie Mihalek (R-Allegheny/Washington), creates a standard formula to apply the 6% tax at 25% of the retail value, and provides the parity that industrywide stakeholders across the state have argued for.

    House Bill 1549 now goes before the state Senate for consideration.

     

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    House Passes Charter School Reform Measures

    The state House passed a package of bills designed to update Pennsylvania’s charter school law.

    House Bill 355, sponsored by Rep. Mike Reese (R-Westmoreland), would make ethics, transparency, governance, and auditing reforms. House Bill 356, sponsored by Rep. Matthew Dowling (R-Fayette), would address charter school facilities, including the use of sectarian facilities, purchase of school district facilities, operation of more than one charter school location, and access to testing facilities. House Bill 357, sponsored by Rep. Jesse Topper (R-Bedford), would establish uniform processes and procedures related to charter applications, renewals, amendments, enrollment, and attendance records. House Bill 358, sponsored by Rep. Jim Marshall (R-Beaver), would permit charter schools and area vocational-technical schools to enter dual enrollment agreements with institutions of high education.

    The bills now head to the state Senate for consideration.

     

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    House Bill Would Establish State-Based Exchange and Reinsurance Program

    Legislation establishing a state-based health insurance exchange and reinsurance program was approved by the state House with bipartisan support. House Bill 3 is sponsored by House Majority Leader Bryan Cutler (R-Lancaster) and Democratic Leader Frank Dermody (D-Allegheny).  

    The state exchange makes no changes to preexisting condition or other enrollment requirements that exist at the federal level. If the Affordable Care Act law changes or is eliminated, the Pennsylvania exchange would reflect those changes.

    Currently, more than 400,000 Pennsylvanians buy health insurance through healthcare.gov at a cost of $85 million to $90 million to the state in fees to run the site. Under this plan, those fees would be kept in Pennsylvania, and the state Insurance Department would run the exchange.

    The bill advances to the Senate for further consideration.

     

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    Senate Welcomes Newest Members

    Doug Mastriano and Joe Pittman, both Republicans, won special elections to the Pennsylvania Senate on May 21, and both were sworn into office this week.

    Mastriano represents the 33th Senatorial District, which includes all of Adams County and parts of Cumberland, Franklin, and York counties. A retired U.S. Army colonel, Mastriano, has a doctorate from the University of New Brunswick and a master’s degree in military operations, strategic intelligence, airpower, and strategy. Mastriano’s committee assignments are as follows:

    • Intergovernmental Operations, chair
    • Agriculture & Rural Affairs, vice chair
    • Game & Fisheries
    • State Government
    • Transportation
    • Veterans Affairs & Emergency Preparedness

    Pittman represents the 41st Senatorial District, which includes Armstrong and Indiana counties and parts of Butler and Westmoreland counties. Pittman served as chief of staff to Sen. Don White, who retired in February. Pittman’s committee assignments are as follows:

    • Environmental Resources & Energy, vice chair
    • Appropriations
    • Banking & Insurance
    • Communications & Technology
    • Game & Fisheries
    • Judiciary

     

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Contact Government Relations

governmentrelations@picpa.org
Peter Calcara | 717-232-1821
Alexandra Fabian | 717-232-1821
Annette Knapp | 717-232-1821

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Rep. Mary Jo Daley: Attend Day on the Hill and Get Your Legislator's Attention
2018 Q&A with the DOR

The PICPA met with the Pennsylvania Department of Revenue on Oct. 24, 2018. View the full transcript, watch the recording, or view past discussions from 2010-2017.

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