Many municipalities have taken advantage of the Emergency and Municipal Services Tax (EMS Tax) authorized recently by the state legislature. The tax, which can be levied in a maximum amount of $52 per year, replaced the Occupational Privilege Tax (OPT) and must be used to raise revenue for emergency and municipal services (fire protection, ambulance service, street plowing, etc.). Now, the legislature is close to amending the Local Tax Enabling Act to refine and revise this relatively new tax. The Senate has adopted a new version, in SB 157 (html – pdf), and the legislation currently is in the House for consideration there. Among some minor editing changes, the new version of the tax would be called the “Municipal Services Tax,” eliminating the word “Emergency.” The bill also eliminates any requirement that the revenue go directly to fund municipal or emergency services. I believe that this change simply reflects the legislature’s consideration that it might be difficult to determine exactly what types of expenditures are “municipal” ones and which are not. In addition, the bill requires that municipalities exempt from the payment of such a tax any person whose income is under $12,000. Also, if the tax is greater than $10, the tax is to be collected on a pro rata basis throughout the year. Currently, the tax must be collected at one time, regardless of the amount. It is expected that the House will approve at least some version of this bill and that whatever version is approved by both chambers ultimately will be approved by the Governor. Until then, we will keep our eyes on it.
February 1, 2006
Possible Changes to EMS Tax?
This entry was posted on Wednesday, February 1st, 2006 at 4:39 pm and posted in Municipal Law. You can follow any responses to this entry through the RSS 2.0 feed.
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