HB 2370 — An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in personal income tax, further providing for imposition of tax and for requirement of withholding tax.

PRINTER'S NO.   3159

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 2370
                                                  Session of
                                                    2026

     INTRODUCED BY ROWE, STENDER, PUGH, MIHALEK, OLSOMMER, KUTZ,
        MARCELL, SMITH, PICKETT, LABS, KUZMA, HAMM, COOPER,
        WEAKNECHT, WATRO AND GLEIM, APRIL 9, 2026

     REFERRED TO COMMITTEE ON FINANCE, APRIL 9, 2026


                                    AN ACT
 1   Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
 2      act relating to tax reform and State taxation by codifying
 3      and enumerating certain subjects of taxation and imposing
 4      taxes thereon; providing procedures for the payment,
 5      collection, administration and enforcement thereof; providing
 6      for tax credits in certain cases; conferring powers and
 7      imposing duties upon the Department of Revenue, certain
 8      employers, fiduciaries, individuals, persons, corporations
 9      and other entities; prescribing crimes, offenses and
10      penalties," in personal income tax, further providing for
11      imposition of tax and for requirement of withholding tax.
12      The General Assembly of the Commonwealth of Pennsylvania
13   hereby enacts as follows:
14      Section 1.    Sections 302(a) and (b) and 316.1(a) of the act
15   of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
16   1971, are amended to read:
17      Section 302.    Imposition of Tax.--(a)     Except as provided in
18   subsection (c), every resident individual, estate or trust shall
19   be subject to, and shall pay for the privilege of receiving each
20   of the classes of income hereinafter enumerated in section 303,
21   a tax upon each dollar of income received by that resident
22   during that resident's taxable year at the rate of:
 1         (1)   Except as provided under paragraph (2), three and seven
 2   hundredths per cent.
 3         (2)   For the time period beginning the first day of the first
 4   full month after the effective date of this paragraph and ending
 5   on the first day after the end of the sixth full month after the
 6   effective date of this paragraph, two and ninety-nine hundredths
 7   per cent.
 8         (b)   Except as provided in subsection (c), every nonresident
 9   individual, estate or trust shall be subject to, and shall pay
10   for the privilege of receiving each of the classes of income
11   hereinafter enumerated in section 303 from sources within this
12   Commonwealth, a tax upon each dollar of income received by that
13   nonresident during that nonresident's taxable year at the rate
14   of:
15         (1)   Except as provided under paragraph (2), three and seven
16   hundredths per cent.
17         (2)   For the time period beginning the first day of the first
18   full month after the effective date of this paragraph and ending
19   on the first day after the end of the sixth full month after the
20   effective date of this paragraph, two and ninety-nine hundredths
21   per cent.
22         * * *
23         Section 316.1.   Requirement of Withholding Tax.--(a)   Every
24   employer maintaining an office or transacting business within
25   this Commonwealth and making payment of compensation (i) to a
26   resident individual, or (ii) to a nonresident individual
27   taxpayer performing services on behalf of such employer within
28   this Commonwealth, shall deduct and withhold from such
29   compensation for each payroll period a tax computed in such
30   manner as to result, so far as practicable, in withholding from

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 1   the employe's compensation during each calendar year, or
 2   portions of calendar years for periods subject to section 302(a)
 3   (2) or (b)(2), an amount substantially equivalent to the tax
 4   reasonably estimated to be due for such year or portion of
 5   calendar years with respect to such compensation. The method of
 6   determining the amount to be withheld shall be prescribed by
 7   regulations of the department.
 8      * * *
 9      Section 2.   This act shall take effect July 1, 2026, or
10   immediately, whichever is later.




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