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BOROUGH WEST CHESTER AND BOROUGH COUNCIL BOROUGH WEST CHESTER v. TAXPAYERS BOROUGH WEST CHESTER (11/20/89)

decided: November 20, 1989.

BOROUGH OF WEST CHESTER AND BOROUGH COUNCIL OF THE BOROUGH OF WEST CHESTER, APPELLANTS,
v.
TAXPAYERS OF THE BOROUGH OF WEST CHESTER, APPELLEES



Appeal from the Common Pleas Court, Chester County; Honorable Charles B. Smith, Judge.

COUNSEL

Stephen P. McGuire, Buckley, Nagle, Gentry, McGuire & Morris, West Chester, for appellants.

Sharon L. Cloud, Saling & Litvin, West Chester, for appellees.

Stephen S. Russell, Chief Staff Counsel, New Cumberland, for amici curiae, Pennsylvania School Boards Ass'n.

Allen C. Warshaw, with him, Scott C. Penwell, Duane, Morris & Heckscher, Harrisburg, for amici curiae, Pennsylvania Food Merchants Ass'n and Pennsylvania Petroleum Ass'n.

McGinley and Smith, JJ., and Narick, Senior Judge.

Author: Mcginley

[ 129 Pa. Commw. Page 546]

Appellants, the Borough of West Chester (Borough) and the Borough Council (Council), have appealed from an order of the Court of Common Pleas of Chester County (trial court) which invalidated both a local mercantile tax ordinance and an amendment to the local business privilege tax ordinance. There are no relevant facts in dispute and the only legal question is whether these local tax ordinances violate Section 533 of the Local Tax Reform Act (Act).*fn1

On December 1, 1988, Council enacted two ordinances taxing gross business receipts: one adopted a mercantile tax and the other amended an existing business privilege tax from a flat rate to a millage rate. Prior to the passage of these ordinances, the Borough had no mercantile

[ 129 Pa. Commw. Page 547]

    nor business privilege tax on gross receipts. After the Governor signed the Act into law on December 13, 1988, various taxpayers of the Borough (Appellees) filed this suit challenging the two ordinances enacted on December 1 as being ultra vires. All Appellees herein conduct business activities in the Borough which subject them to the gross receipts taxes imposed by these two ordinances.

The trial court found that the ordinances were passed beyond the deadline set by Section 533 of the Act for the imposition of gross receipts taxes and, therefore, declared the ordinances null and void. The trial court based its decision on the plain meaning of Section 533 which reads as follows: "After November 30, 1988, and notwithstanding any other provisions of this Act except for subsection (b),*fn2 no political subdivision may levy, assess or collect or provide for the levying, assessment or collection of a mercantile or business privilege tax on gross receipts or part thereof." Our scope of review of the trial court's decision is limited to determining whether the trial court abused its discretion or committed an error of law. Jenkins v. McDonald, 92 Pa. Commonwealth Ct. 140, 498 A.2d 487 (1985). Since the present case involves no disputed facts, the sole issue is whether the trial court erred in applying Section 533 of the Act to invalidate the ordinances in question.

Pursuant to the Statutory Construction Act of 1972, when the language of a statute is clear and unambiguous, legislative intent must be gleaned from the statute itself.*fn3 The legislative history cannot serve as a pretext for disregarding the plain meaning of the words contained therein. Section 533 is entitled "Abolishment of Tax" and clearly prohibits a political subdivision which had not previously ...


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