Q & A – Emergency and Municipal Services Tax

What is the Emergency and Municipal Services Tax (EMST)?

On December 1, 2004, the Commonwealth of Pennsylvania signed into law the new Act 222, which provides municipalities the ability to impose a new Emergency and Municipal Services Tax. The EMST replaces the $10 Occupational Privilege Tax (OPT), which has been in place since 1986 in West Hanover Township.

What differentiates the EMST from the OPT?

The EMST and OPT are essentially the same type of tax.  Differences include the rate of the two taxes paid by individuals, with OPT’s $10 per year being increased under the new law to $52 per year. Today, the EMST is required by law to be used for specific purposes (e.g. emergency services, public maintenance of streets, tax reduction) and the Township has taking steps to ensure accountability of this requirement.  The $10 OPT was not earmarked for specific purposes and in the past deposited in the Township General Fund and used without restriction.

Who will pay the EMST?

Like the OPT, EMST is paid by all individuals (employed or self- employed) who work in West Hanover Township.  On December 20, 2004 the West Hanover Township Board of Supervisors amended the OPT Ordinance to replace the OPT with the new EMST at the original $10 rate.  On November 7, 2005 the West Hanover Township Board of Supervisors increased the EMST rate from $10 to $52, which became effective on January 1, 2006.

Will any person who works in the Township be exempt from paying the EMST?

The Township’s EMST ordinance provides a low-income exemption to individuals whose annual compensation (gross wages, commissions, gross receipts and/or any other income) totals less than $5,000 per calendar year. Therefore, individuals who are compensated less than $5,000 will NOT be required to pay the EMST.

When is payment of the EMST due?

Employers and self-employed individuals in the Township are responsible for withholding the EMST for each individual subject to the tax or their own payroll, respectively.  Employers are required to withhold the EMST for each individual who reaches the minimum level of $5,000 or more of annual compensation. Employers and/or self-employed individuals are required to remit the tax collected and file a tax return with the Township on or before the last day of April, July, October and January for the four quarters ending the last day of March, June, September and December. 

How many people does this affect?

It is estimated that approximately 3900 employees are at work in West Hanover Township at 245 business and firms listed on the EMST tax rolls.  The ratio of resident works and non-resident workers is not known.  However, all employed persons, whether commuting from outside areas and/or those who reside within the Township, enjoy the many services and amenities provided by the Township.

How will the EMST revenue be used by West Hanover Township?

The Township must use funds from EMST for police, fire or emergency services and road construction or maintenance.  The Township has attempted to support services with EMST funds that will benefit the working tax payers in the Township.  Specifically, the Township uses EMST funds to support the budgetary accounts listed below: 

41100  FIRE - FIRE POLICE

41200  AMBULANCE /RESCUE

41500  EMERGENCY MANAGEMENT

43300  TRAFFIC CONTROL

43800  MAINT. & REPAIRS OF HIGHWAYS