PHILADELPHIA (CBS) — Some homeowners could catch a big property tax break because of Tuesday’s vote— but there is a catch.
Voters statewide approved an expanded Homestead Tax Exemption amendment. The Pennsylvania legislature still needs to work out the details, however, soon cities could allow homeowners to avoid paying up to 100 percent of property taxes.
The catch is cities will then presumably replace the lower property taxes with higher sales and a higher income tax.
Accountant Kevin Chou with Philadelphia firm Internal Tax Service, and other tax experts, said there are clear winners and losers with the exemption passage.
Homeowners, especially fixed-income seniors, could save money.
Schools, which rely on property tax income, and renters who will not see a tax break, lose.
Chou suggests some people may adjust where they live, work and shop based on what cities decide.
It will still take some time for the Commonwealth and cities looking to take advantage of the amendment to put plans in place.
But Philadelphians don’t need to worry about a big tax change, according to the City Council’s finance chairwoman Jannie Blackwell.
She said there would be “absolutely no change whatsoever” to city tax policy because of the election.