Overview
House Bill 2488 (2025-2026 Regular Session) from Pennsylvania would amend the Local Tax Enabling Act (Act of December 31, 1965, P.L.1257, No. 511). The bill focuses on local taxation powers and restrictions, with an emphasis on improving municipal fiscal stability. It was introduced by Rep. Ismail Smith-Wade-El and has a broad group of co-sponsors from both chambers.
Status: Referred to the Local Government committee on May 6, 2026.
Primary purpose:
- To update and modify provisions related to the delegation of taxing powers to local authorities.
- To adjust restrictions on certain local taxes and rates, with the aim of preventing municipal fiscal distress and enhancing local revenue tools.
Key Provisions (as described)
Note: The bill text itself is not fully included in the provided materials, but descriptions indicate the following areas of focus:
Delegation of taxing powers:
- Revisions to how local governments can delegate or authorize tax-levying authorities.
- Clarifications or expansions of the authority of municipalities to impose or administer certain local taxes.
Restrictions on local taxes:
- Revisions to rate limits or other restrictions on specific local taxes.
- Potential adjustments to what taxes municipalities may impose or how rates are determined.
Fiscal stability and distress prevention:
- Provisions intended to address municipal fiscal distress, possibly by enabling more flexible revenue-raising tools for financially strained municipalities.
- Measures that could affect budgeting, revenue forecasting, or debt/financing related to local tax revenues.
Because the full bill text isn’t included here, the exact statutory language, specific tax types affected, and precise numeric changes (rates, thresholds, timelines) are not provided.
Who Is Affected
- Local governments in Pennsylvania (cities, towns, boroughs, and counties) that rely on local taxes and the Local Tax Enabling Act framework.
- Taxing authorities and municipal management entities responsible for delegating or administering local taxes.
- Taxpayers within municipalities that would be subject to any newly authorized or adjusted local taxes or rate changes.
Procedural and Timeline Details
- Bill number: HB 2488
- Session: 2025-2026
- Status: Referred to Local Government committee on May 6, 2026
- Current stage: Legislative committee consideration; no floor action or votes recorded in the provided materials.
Additional Context
- This bill is part of a broader set of amendments to the Local Tax Enabling Act, which has seen prior related measures (e.g., HB 852, HB 1424, HB 1582, SB 527) addressing topics such as delinquent tax collection, campground affordability, business gross receipts taxes, and reimbursement mechanisms. HB 2488 is positioned as a modernization and reform effort to better equip municipalities to manage local taxes and avert fiscal distress.
Potential Impacts (expected)
- If enacted, municipalities may gain clearer or expanded authority to delegate taxing powers.
- Local tax regimes could see changes in permissible rates or structures, potentially affecting revenue streams for local governments.
- Municipalities facing fiscal stress might have new tools or greater flexibility to address revenue shortfalls, impacting budgeting and services.
Note: For a precise understanding of the bill’s provisions, exact language, and numerical changes, the full text and any committee amendments would be required.
