Updated: House Moves Compromise Tax Bill Without Environmental Riders

Note: House Democrats just brought up discharge resolution for the severance tax bill-- House Bill 113- from the House Environmental Resources and Energy Committee which failed 115 to 83.

The House Rules Committee late Tuesday amended and reported out the Tax Code bill-- House Bill 542-- with a statewide, five percent hotel tax that House Majority Leader David Reed (R-Indiana) hopes will break a logjam in the budget process.  Click Here for an amended copy of the bill.

The hotel tax is expected to bring in $96 million this year and $165 million next year.  Rep. Reed said there is agreement with the Senate and Gov. Wolf on the hotel tax. However, a spokesperson for Gov. Wolf told the AP this evening he is still reviewing the bill and still believes "strongly" a natural gas severance tax would be the most responsible recurring revenue.

He hoped the House could begin debate on the tax bill on Tuesday night, but did not. The House returned Wednesday morning at 9:00 a.m. briefly and then went to party caucuses.
After today, the House and Senate are not scheduled to be back in Harrisburg until October 16, after the Columbus Day holiday.

Rep. Reed said the package retains the provisions related to applying the Sales Tax to online marketplaces, a 12 percent assessment on fireworks purchases, provisions related to the Net Operating Loss in the event of an adverse PA Supreme Court decision.

The amendment also made changes to the timing and withholding of individual and lease taxes, added a deduction for manufacturing innovation and reinvestment, establishes two film production tax credit districts, established an entertainment economic enhancement program tax credit for rehearsal areas

He said gone from the package are the increases in the natural gas, electric, telephone gross receipt taxes.  Also not included is a commercial warehouse tax talked about for the last two days and presumably a natural gas severance tax.

Also gone are environmental riders that have nothing to do with taxes, including--

-- Third-Party Permit Reviews: Requires DEP to set up a third-party permit review program for all its permit programs that would allow unqualified individuals review and issue permits, even their own applications.

-- Legislative Approval Of Oil & Gas Emission Controls: Creates a special 7-member (6 legislative appointees) “Advisory” Committee that must approve any air quality general permits for oil and gas operations that is clearly designed to block the General Permits DEP proposed to better control these emissions.

-- Deemed Approved Oil & Gas Permits: Would deem approved oil and gas well permits where DEP did not complete a review within a certain number of days regardless of whether they met environmental standards or not.

However, there are other possible vehicles for these provisions still in the House, including the Administrative Code bill-- House Bill 118-- and the Fiscal Code bill-- House Bill 543.

These other environmental and energy tax provisions are not included--

-- Wild Conservation Tax Checkoff: Not included

-- Regional Electric Transmission Transaction Tax: Not included

With respect to gaming, he said things are moving in a positive direction, but things are not fully resolved.  Asked about video gaming terminals, Rep. Reed said everyone knows the House and Senate were in different places on the issues, but he said House Republicans are willing to “give a little bit to get a little bit in return.”

“This is a major piece [Tax Code bill],” Rep. Reed said.  “This is the component that has been holding up the process so far.”

Click Here for a copy of the amended bill.  Click Here for a summary by House Democratic Appropriations.. The new language begins on page 104.

(Based on a Periscope app webcast by PLS Reporter.)
NewsClip:
AP: Gov. Wolf Mum On Higher Hotel Tax