Active duty military pay would again be exempt from local taxes if legislation sponsored by Sen. Lisa Baker (R-20) becomes law. The policy had been in place for 50 years, until changes intended to improve tax collection enforcement inadvertently ended the exemption in 2012.
“The military operations of the Pennsylvania National Guard have increased tremendously in the past few years as more and more personnel have been ordered to serve at home and abroad in support of major deployments. These soldiers are required to take leave from their families and professional careers – often at lower pay – to serve our country, and I believe the wages they earn for this service should not be subject to taxation,” Baker said.
Senate Bill 652 was approved unanimously by the Senate on July 14 to correct the problem and expand the benefit to include all active military service, whether earned inside or outside of the Commonwealth. Wages earned during training exercises or other inactive duty would continue to be taxed.
Andrew M. Seder
(570) 226-5960