Hold onto your wallets.

The state Legislature is examining placing taxes on everything
from candy to investment services, membership fees and
advertisements in an effort to come to a reasonable solution to the
state’s property tax issue.

As if deciding how to implement property tax reform wasn’t a
hard enough task, lawmakers are doing so under the glare of an
election year, knowing full well that at least one segment of their
constituency won’t be in favor of whatever solution is reached.

“No matter what you do, the money has to come from someplace,”
state Rep. Martin Causer, R-Turtlepoint, said. “We have fierce
property tax issues right now. In addition to using the gambling
revenue, there are only two options really available – income and
sales taxes.

“I look at it from the perspective that the property owners are
being unfairly taxed too much now. We are relying too much on
property owners to fund education.”

The most recent piece of legislation to be examined is Senate
Bill 854, which actually derived from legislation in the House,
which amended it to broaden the sales tax base to include taxing
advertisements and investment services, among others.

Causer said the vote on the amendment barely passed the House by
a tally of 105-90, with state Rep. Kathy Rapp, R-Warren, voting in
favor of it, and state Rep. Dan Surra, D-Kersey, voting against it.
A measure needs 102 votes to pass the House.

“I think we have to be very cautious moving forward,” state Sen.
Joe Scarnati, R-Brockway, said. “Many of these items were exempt
for years, and there was a reason they were. With the House plan,
you are looking at a major tax increase.”

Scarnati said the state Department of Revenue should be allowed
to look at what’s exempt in an effort to find items that are not so
binding on taxpayers. The Senate is also holding hearings this week
to deal with the issue, “shedding a light on what took place in the
House.”

“There is no doubt. Somebody is going to be angry when all this
is said and done,” Scarnati said. “This is a tax shift and there
are going to be winners and losers. But, we’ll try and keep it as
fair as we can.”

However, both lawmakers agree that Gov. Ed Rendell needs to be
more actively involved in the effort.

“There is a lot of work that still needs to be done,” Causer,
who is expected to run for re-election this year, said. “The
governor needs to be involved in this more. We need him to come to
the table and say what he supports and doesn’t.”

For his part, Scarnati said “Right now where we are at, the
governor should step up to the plate and come up with a compromise.
He has the ability to do that.”

Weeks after a special session on property taxes was called to
order, the state still doesn’t have property tax relief in sight.
The chambers reached an impasse right before the Christmas holiday
break, in part, after the Senate rejected Senate Bill 30, which
called for a minimum 35 percent reduction in property taxes and for
voters to decide in this year’s primary election whether to reduce
school property taxes by raising the local earned income tax.

“I voted in favor of Senate Bill 30 because I thought it brought
us closer to a real plan,” Causer said, adding legislators should
look at broadening the sales tax base. “But, I don’t think anybody
believes this is finalized yet. You have to look at the whole
issue.”

Neither Scarnati or Causer said they are in favor of taxing
advertisements, which could effect The Era and other media outlets.
It’s believed the unofficial 6 percent tax could also be levied
against Internet ads, legal notices and even obituaries.

Causer said a similar tax was enacted in Florida, but was later
recalled due to problems associated with it.

“I don’t think we should have a tax on business and job
creators,” Scarnati said. “I’m concerned that we could be going
down a very slippery slope here. God knows we need jobs here. When
we start playing with a mix of taxes we have to be careful we don’t
swing the pendulum so far that we lose employment.

“The business environment in this state is so bad now, why would
we make it worse. We need to do this in a responsible fashion.”

Scarnati said in light of last year’s pay raise debacle,
legislators are increasingly under the microscope.

“There is somewhat of a move within the Legislature to pander to
the public’s liking,” Scarnati said. “I think we have to be very
careful to do what is right for the Commonwealth. It scares me and
is very concerning.”