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Delay Of Tax Deadline Will Cause ‘Significant Disruption’ To State Budget Process - And Local Governments as Well!

Delay Of Tax Deadline Will Cause ‘Significant Disruption’ To State Budget Process - And Local Governments as Well! | Newtown News of Interest | Scoop.it

With the coronavirus outbreak leading to layoffs, business closures, and a record spike in unemployment claims, Pennsylvania has delayed the deadline for filing personal income tax returns, offering taxpayers much-needed relief.

 

*****COVID-19 Employee Survey*****

https://www.surveymonkey.com/r/PWWQQGP 

 

How have you been impacted by COVID-19?

 

As a Newtown Township Supervisor I expect that I will be called upon to make critical decisions in the coming weeks in response to the financial impact on Newtown Township and citizens of the Coronavirus pandemic and the emergency mitigation measures currently in place. Consequently, it is important that I get feedback from local employees that have been impacted by COVID-19.

The survey should take less than 5 minutes to complete. No identifying information is collected via this survey unless you opt-in to provide such information for purposes of follow-up or by subscribing to my email newsletter.

 

NOTE: If you are an EMPLOYER, please take my COVID-19 Business Survey: https://www.surveymonkey.com/r/D7CVTJ2

 

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But it also could create a cash crunch for the state and put lawmakers in the difficult position of trying to pass a budget without knowing how badly tax revenues have been affected by the economic fallout of the COVID-19 crisis.

 

The delayed filing deadline — which the Department of Revenue moved from April 15 to July 15 to correspond with federal changes by the IRS — will cause “significant disruption to the budget process,” Senate Majority Leader Jake Corman (R., Centre) said.

The state typically collects a large chunk of income tax revenue in March and April as people file right before the deadline, Corman said. With the delay, actual and projected revenues will be “very difficult to know” by the June 30 deadline for passing the budget.

“That will be a challenge for all of us like we’ve probably never seen before,” Corman said, adding that lawmakers might need to pass a short-term budget because of the uncertainty.

The outbreak is expected to deal a serious blow to the state’s bottom line as efforts to slow the spread of the virus shutter wide swaths of the economy, undercutting several sources of tax revenue. Already, Gov. Tom Wolf has ordered a hiring freeze and general purchasing ban for state agencies in an effort to cut spending.

johnmacknewtown's insight:

Note that in addition to loss of Earned Income Tax related to COVID-19 layoffs (read “PA Unemployment Claims Skyrocket”; http://sco.lt/8s31Qu), Newtown Twp is in danger of losing a significant amount of Real Estate Transfer Tax revenue if the decline in home sales persists. Real Estate Transfer Tax is a tax assessed and imposed upon the transfer of real property or an interest in real property within the limits of Newtown Township, regardless of where the instruments making the transfers are made, executed or delivered or where the actual settlements on the transfer take place, at the rate of 1% of the amount of the value of said real property. This tax is split between the Township and the Council Rock School District.

 

NOTE: The Township relies entirely on earned income tax, real estate transfer tax, and a local services tax to fund the general operations of the Township.

 

“COVID-19 Employee Impact Survey”; https://www.surveymonkey.com/r/6HTHQML

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