Legal Question in Tax Law in Pennsylvania

No ethnic or religious group is tax-exempt in the US (save extra-territorial groups such as those on Indian reservations). Your student was probably misstating an aspect of certain Hasidic Jewish sects, where they tend to manage their own affairs without interference from outside authorities. This is similar to some other groups - being from PA you are no doubt familiar with the Amish. While there may be little utilization of governmental jurisprudence for most civil and criminal matters within such communities, there is no exemption from taxes. Certain communities are prone to operating on a cash basis and evading taxes, but that has never been a known quality of Hasidic Jewish communities in America. Hasidim have a duty to report income to the government just the same as anyone else, and generally they do so.