Mackenzie’s Bill to Reduce Fraud Signed into Law

HARRISBURG – Today, the governor signed into law House Bill 16, Rep. Ryan Mackenzie’s (R-Lehigh/Berks) legislation designed to reform the local tax collection system to reduce instances of fraud.

“Local tax collectors take on a great responsibility with ensuring the proper collection of taxes; however, with little clarity in the law as to best practices, misuse of the system can occur,” said Mackenzie. “My legislation corrects those oversights to eliminate fraud by unscrupulous tax collectors.”

The current Local Tax Collection Law does not specify how taxes are to be paid, so it is left to individual tax collectors to determine how they want checks made out for the payment of taxes and what account the tax money is to be deposited. This means a tax collector could have a taxpayer write a check in only the tax collector’s name and deposit it his or her personal bank account.

Mackenzie’s House Bill 16, now Act 38 of 2017, prohibits checks to made in the tax collector’s name only. Under the new law, checks should be made payable to the name of the tax collector along with the office, title, or position; or be made out just to the office, title or position and then be deposited into a separate bank account only used for tax money.

“Most of our state’s tax collectors are hard-working citizens who do an outstanding job; however, we have had instances over the years in which some tax collectors have taken advantage of the current law and used it to steal money from the people they were supposed to be serving,” said Mackenzie.

Examples of fraud perpetrated under the current law include $1.4 million stolen in Baden Borough in Beaver County between 2007 and 2015, and $300,000 stolen from Spring Garden Township in York County between 1995 and 2009 from tax collectors.

“By changing how accounts are set up and how checks are written, this new law will give municipalities and taxpayers an added layer of protection by ensuring their tax dollars go where they are intended,” said Mackenzie.

Act 38 goes into effect Jan. 1, 2018.

Representative Ryan Mackenzie
134th District
Pennsylvania House of Representatives
Media Contact: Tricia Lehman
717.772.9840
tlehman@pahousegop.com
RepMackenzie.com / Facebook.com/RepMackenzie