Appeal from decree of Court of Common Pleas of Montgomery County, No. 67-13905, in case of Robert Sullivan, Frank A. Puchon et al. v. H. Walter Peters et al.
Andrew B. Cantor, with him Raymond Pearlstine, and Wisler, Pearlstine, Talone & Gerber, for appellants.
Paul W. Callahan, with him Fox, Differ & DiGiacomo, for appellees.
Bell, C. J., Jones, Cohen, Eagen, O'Brien, Roberts and Pomeroy, JJ. Opinion by Mr. Justice Jones.
Pursuant to The Local Tax Enabling Act, Act of December 31, 1965, P. L. 1257, § 1, 53 P.S. § 6901 et seq. (Supp. 1970) (Act 511), the School District of Upper Merion, Montgomery County, passed a tax resolution which imposed a $10.00 "occupational privilege" tax on individuals employed within the district, whose annual income exceeds $1,000.00. The resolution provides that the employers within the School District are to collect the tax from their employees, retaining a 2% collection commission.
On October 24, 1967, several employees within the School District, appellants herein, instituted an action in equity in the Court of Common Pleas of Montgomery County, whereby they sought: (1) a declaration that the method of collection was unconstitutional, and (2) appropriate injunctive relief. There being no controversy as to the pertinent facts, the issue was presented to the court below on the briefs, and a final decree was entered on June 9, 1969, rendering judgment in favor of the defendants. This appeal followed.
In essence, the appellants' position is that Act 511 does not authorize a local municipality to pass an ordinance
requiring employers to collect an occupational privilege tax, imposed under the authority of Act 511. Therefore, it is claimed that the local ordinance is unconstitutional insofar as it provides that the tax is to be collected by employers.*fn1 In support of their argument, the appellants point out that Act 511 does specifically provide for an earned income tax to be collected by employers (Act of December 31, 1965, P. L. 1257, § 9, as amended, August 11, 1967, P. L. 228, § 1), although no similar provision was made for the collection of an occupational privilege tax.*fn2
Act 511 authorized certain political subdivisions to "levy, assess and collect or provide for the levying, assessment and collection of such taxes as they shall determine . . . ." Act of December 31, 1965, P. L. 1257, § 2, 53 P.S. § 6902 (Supp. 1970) (Emphasis added). This language is sufficiently broad to permit the tax to be collected directly by the taxpayer's employer, who would forward the taxes to the taxing authority. Wilkinsburg Borough v. Wilkinsburg Borough School District, 365 Pa. 254, 74 A.2d 138 (1950); Blauner's, Inc. v. Philadelphia, 330 Pa. 342, 198 A. 889 (1938). The general provision for the collection of taxes under Act 511 is also broad enough to permit employers' collection of the tax: "Any such political subdivision is hereby authorized to provide by ordinance or resolution for the
creation of such bureaus or the appointment and compensation for such officers, clerks, collectors, and other assistants and employes, either under existing departments, or otherwise as may be deemed necessary, for the assessment and collection of taxes imposed under authority of this act." Act of ...