The disposition of revenue from an earned income and net profits tax or an increase in the rate of an earned income and net profits tax imposed by school districts under the authority of this chapter shall occur in the following manner:
(1) For the fiscal year of implementation of a newly imposed income tax, all earned income and net profits tax revenue received by a school district shall be used first to offset any lost revenue to the school district from the taxes prohibited under section 8701(b) (relating to general tax authorization) in an amount equal to the revenue collected from the prohibited taxes in section 8701(b) in the preceding fiscal year; second, to provide for an increase in budgeted revenues over the preceding fiscal year in accordance with the amount specified in the referendum question approved by the voters under section 8703 (relating to adoption of referendum); and third, to reduce the school district real property tax in the following order:
(i) By means of an exclusion for homestead property pursuant to section 8583 (relating to exclusion for homestead property).
(ii) By means of a reduction in the millage rate after the limit on the exclusion for homestead property has been reached under section 8586 (relating to limitations).
(2) For the fiscal year of implementation of an increase in the rate of the existing earned income and net profits tax imposed under this chapter, all revenue received by a school district directly attributable to the increased rate shall be used to reduce the school district real property tax in the following order:
(i) By means of an exclusion for homestead property pursuant to section 8583.
(ii) By means of a reduction in the millage rate after the limit on the exclusion for homestead property has been reached under section 8586.
Cross References. Section 8717 is referred to in section 8713 of this title.
Structure Pennsylvania Consolidated & Unconsolidated Statutes
Pennsylvania Consolidated & Unconsolidated Statutes
Title 53 - MUNICIPALITIES GENERALLY
Chapter 87 - Other Subjects of Taxation
Section 8701 - General tax authorization
Section 8702 - Continuity of tax
Section 8703 - Adoption of referendum
Section 8704 - Public referendum requirements for increasing property taxes previously reduced
Section 8705 - Local tax study commission
Section 8706 - Property tax limits on reassessment
Section 8711 - Earned income and net profits tax
Section 8714 - Earned income and net profits tax exemption
Section 8715 - Rules and regulations
Section 8716 - Procedure and administration
Section 8717 - Disposition of earned income and net profits tax revenue
Section 8721 - Hotel room rental (Repealed)
Section 8722 - Local option cigarette tax in school districts of the first class
Section 8723 - Local sales tax revenues in cities of the first class