PA tax return - Stock capital loss does not deduct from stock capital gains

Capital gains from mutual funds distributions are reported as dividends on the Pennsylvania tax return. Therefore it cannot be offset by losses on stock transactions reported as the net loss from the disposition of property. 

For more information, read about the Line 5 income in the PA instructions, pages 17-18.

I am struggling over this also - did some tax loss harvesting before year end - got the deductions in Federal return but it seems that PA won't recognize mutual fund losses against capital gains distributions (these are called dividends in PA income tax land).  

I assume this is PA's way to screw over taxpayers but just wanted to confirm my assessment is correct and i will have to not take the losses and pay the 3.07% state tax on the gross amounts.