Pittsburgh's "jock tax" is unconstitutional, Pennsylvania Supreme Court rules
The Pennsylvania Supreme Court ruled on Thursday that Pittsburgh's so-called "jock tax" is unconstitutional.
The ruling means the city will not be able to collect millions from visiting performers and professional athletes. The court said the tax, which only applied to non-residents, violated the state's uniformity clause.
The plaintiffs include the players' associations for the National Hockey League, National Football League and Major League Baseball.
What is the "jock tax?"
Visiting athletes and performers had a 3% percent charge on the income they earned while playing at PNC Park, PPG Paints Arena and Acrisure Stadium.
City residents who play or perform at the stadiums pay a 1% tax on income, plus a 2% school district tax, according to the Associated Press.
Impact of the "jock tax" ruling
Since its inception, the tax has brought the city more than $79 million in fees. Deputy Mayor Jake Pawlak said the city is assessing the loss of an estimated $4 million a year in tax revenue in a time of tight budgets.
"In the grand scheme of things, it's $4 million out of a $700 million budget," Pawlak said. "It's not a major change. This is one of what we know to be two difficult years where the margins are tight. So, we'll have to make adjustments for this as to what we'll be proposing."
Next week, the city will announce its budget projections for next year and whether a tax increase will be needed.
In a statement on Thursday, Pittsburgh City Controller Rachael Heisler said, in part, that the city needs to "focus on cost containment. In the longer term, this ruling highlights the urgent need for the City to find new sources of revenue, including growing our local economy."