VAN KAMPEN MERRITT PENNSYLVANIA QUALITY MUNICIPAL TRUST, N-30D, 1995-10-27

VAN KAMPEN MERRITT PENNSYLVANIA QUALITY MUNICIPAL TRUST
N-30D, 1995-10-27

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<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Table of Contents
- --------------------------------------------------------------------------------
<S> <C>
Letter to Shareholders................. 1
Performance Results.................... 3
Portfolio of Investments............... 4
Statement of Assets and Liabilities.... 7
Statement of Operations................ 8
Statement of Changes in Net Assets..... 9
Financial Highlights................... 10
Notes to Financial Statements.......... 11
Independent Auditors' Report........... 14
Dividend Reinvestment Plan............. 15

</TABLE>

Page 1
- --------------------------------------------------------------------------------
Letter to Shareholders
- --------------------------------------------------------------------------------
October 12, 1995

[PHOTO]
Dennis J. McDonnell and Don G. Powell

Dear Shareholder:
The first eight months of 1995 have been very positive for most investors.
Both the fixed-income and stock markets have made considerable gains for the
period ended August 31, 1995.
This year serves as a reminder of just how quickly markets can move and how
difficult it can be to predict the timing of those movements. Moreover, this
year reinforces the importance of maintaining a long-term perspective and
reaffirms the principle that it is time---not timing---that leads to
investment success.

Economic Overview
Due in large part to the Federal Reserve Board's efforts to tighten monetary
supply in 1994, the economy has slowed significantly this year. Evidence of
this guided slowdown was reflected in gross domestic product for the second
quarter, which grew at an annual rate of 1.3 percent, substantially lower than
its first quarter rate of 2.7 percent and fourth quarter 1994 rate of 5.1
percent. While other key economic data, including unemployment rates and
housing starts, have shown mixed signs during recent months, the general
trends for the year continue to support a "soft landing" scenario.
Comfortable with the economy's rate of growth and level of inflation, the Fed
reversed its trend of raising interest rates and lowered short-term rates by
0.25 percent on July 6. Financial markets, perceiving the Fed's monetary
initiatives had taken hold without driving the economy into a recession, rallied
through much of the year. With slowing growth, interest rates declined and the
value of many fixed-income investments rose (bond yields and prices move in the
opposite direction). For example, the yield on 30-year Treasury securities fell
from 7.88 percent at the end of December to 6.66 percent at the end of August,
while its price rose more than 14 percent. Likewise, the yield on the Bond
Buyer's Municipal Bond Index fell from 7.28 percent at the end of December
to 6.30 percent at the end of August. Although municipal bond yields have
declined, they are still offering competitive yields, particularly to those
investors in higher tax brackets.

Performance Summary
The Trust produced a tax-exempt distribution rate of 6.72 percent<F3>,
based on the closing stock price of $16.25 per common share on August 31, 1995.
Since income from the Trust is

(Continued on page two)

Page 2

exempt from federal and state income tax, it is also important to compare the
Trust's distribution rate to an equivalent taxable rate. For example, for
Pennsylvania residents in the combined marginal tax bracket of 37.8 percent, the
Trust's distribution rate represents a yield equivalent to a taxable investment
earning 10.80 percent<F4>. Additionally, for the one-year period ended
August 31, 1995, the Trust generated a total return at market price of
8.02 percent <F1>, which includes reinvestment of dividends and capital gains.
One element influencing the performance of the municipal market this year has
been the ongoing debate over tax reform. While there has been varied
speculation about the impact of reform, no one is certain about what will
happen. Consequently, the municipal market may continue to experience short-term
market fluctuations as various proposals come to the forefront. We will keep a
close watch over any new developments and evaluate the potential impact they may
have on your investment in the Trust.

Outlook
We believe the Fed will move cautiously before it continues to lower
short-term rates, waiting for further signs that the economy has settled into a
slow growth pattern. We anticipate the economy will grow at an annual rate
between 2 and 3 percent in the second half of the year, and that inflation will
run at an annualized rate between 3.1 and 3.3 percent. Based upon a generally
modest growth and low inflation outlook, we believe fixed-income
markets---including municipal bonds---will continue to make positive gains.
As interest rates continue to fall in response to further easing by the Fed,
we believe yields on short-term municipal bonds will continue to move
significantly lower than long-term municipal bonds. Lower short-term rates
typically translate into lower leveraging costs for the Trust, which provides
increased opportunities for higher earnings over time. We believe the Trust's
portfolio is well positioned to take advantage of a declining and sustained
short-term interest rate environment.
Once again, it is important to remember that financial markets will inevitably
experience highs and lows, but by maintaining a long-term investment
perspective, you may ride the ups and downs of the markets more easily as you
pursue your investment goals.
Thank you for your continued confidence in your investment with Van Kampen
American Capital and for the privilege of working with you in seeking to reach
your financial goals.

Sincerely,

Don G. Powell Dennis J. McDonnell
Chairman President
Van Kampen American Capital Van Kampen American Capital
Investment Advisory Corp. Investment Advisory Corp.

Page 3

- --------------------------------------------------------------------------------
Performance Results for the Period Ended August 31, 1995
Van Kampen Merritt Pennsylvania Quality Municipal Trust
NYSE Ticker Symbol -- VPQ
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>

<S> <C>
Total Returns
One-year total return based on market price<F1>......................................... 8.02%
One-year total return based on NAV<F2>.................................................. 8.90%

Distribution Rates
Distribution rate as a % of initial offer common stock price<F3>....................... 7.28%
Taxable-equivalent distribution rate as a % of initial offer common stock price<F4>.... 11.70%
Distribution rate as a % of closing common stock price<F3>............................. 6.72%
Taxable-equivalent distribution rate as a % of closing common stock price<F4>.......... 10.80%

Share Valuations
Net asset value...................................................................... $ 16.71
Closing common stock price........................................................... $ 16.250
One-year high common stock price (07/11/95).......................................... $ 16.625
One-year low common stock price (11/18/94)........................................... $ 13.375
Preferred share rate<F5>............................................................. 3.85%

<FN>
<F1> Total return based on market price assumes an investment at the market
price at the beginning of the period indicated, reinvestment of all
distributions for the period in accordance with the Trust's dividend
reinvestment plan, and sale of all shares at the closing stock price
at the end of the period indicated.

<F2> Total return based on net asset value (NAV) assumes an investment at the
beginning of the period indicated, reinvestment of all distributions for
the period, and sale of all shares at the end of the period, all at NAV.

<F3> Distribution rate represents the monthly annualized distributions of the
Trust at the end of the period and not the earnings of the Trust.

<F4> The taxable-equivalent distribution rate is calculated assuming a 37.8%
combined federal and state tax bracket, which takes into consideration
the deductibility of individual state taxes paid.

<F5> See "Notes to Financial Statements" footnote #5, for more information
concerning Preferred Share reset periods.

A portion of the interest income may be taxable for those investors subject to
the federal alternative minimum tax (AMT).

Past performance does not guarantee future results. Investment return, stock
price and net asset value will fluctuate with market conditions. Trust shares,
when sold, may be worth more or less than their original cost.

</TABLE>

Page 4

- --------------------------------------------------------------------------------
Portfolio of Investments

August 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
Par
Amount Market
(000) Description Coupon Maturity Value
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Municipal Bonds
Pennsylvania 89.5%
$ 6,500 Allegheny Cnty, PA Arpt Rev Gtr Pittsburgh
Intl Arpt Ser B (FSA Insd) ........................ 6.625% 01/01/22 $ 6,719,635
7,475 Allegheny Cnty, PA Hosp Dev Auth Rev Saint
Margaret Mem Hosp ................................. 7.125 10/01/21 7,713,602
2,575 Allegheny Cnty, PA San Auth Swr Rev Ser A (FGIC
Insd) ............................................. * 12/01/08 1,253,124
2,580 Allegheny Cnty, PA San Auth Swr Rev Ser A (FGIC
Insd) ............................................. * 06/01/09 1,202,435
1,645 Allegheny Cnty, PA San Auth Swr Rev Ser A (FGIC
Insd) ............................................. * 12/01/09 745,679
2,475 Allentown, PA Area Hosp Auth Rev Sacred Heart Hosp
of Allentown ...................................... 7.500 07/01/06 2,621,619
2,690 Armstrong Cnty, PA Hosp Auth Hosp Rev Armstrong
Cnty Mem Hosp Ser A ............................... 7.200 11/01/06 2,621,378
5,500 Armstrong Cnty, PA Hosp Auth Hosp Rev Armstrong
Cnty Mem Hosp Ser A ............................... 7.500 11/01/16 5,258,330
1,000 Chester Cnty, PA Hlth & Edl Fac Auth Hosp Rev Bryn
Mawr Rehab Hosp Rfdg (Prerefunded @ 07/01/02) ..... 6.900 07/01/07 1,147,490
1,150 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 03/01/03 799,859
1,130 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/03 767,157
1,195 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 03/01/04 784,039
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/04 780,849
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 03/01/05 753,301
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/05 734,428
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 03/01/06 707,283
1,020 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/06 576,188
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 03/01/07 662,533
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/07 645,185
1,190 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 03/01/08 603,211
1,205 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/08 594,439
1,220 Chichester Sch Dist PA Ser B (FGIC Insd) .......... * 09/01/09 560,761
7,310 Dauphin Cnty, PA Hosp Auth Rev Cmnty Genl
Osteopathic Hosp Rfdg ............................. 7.375 06/01/16 7,495,528
6,000 Delaware Cnty, PA Indl Dev Auth Pollutn Ctl Rev
Philadelphia Elec Co Proj ......................... 7.375 04/01/21 6,445,680
18,000 Emmaus, PA Genl Auth Rev Local Govt Pool G (FGIC
Insd) ............................................. 7.000 05/15/18 19,553,580
4,000 Falls Twp, PA Hosp Auth Hosp Rev Delaware Vly Med
Rfdg (FHA Gtd) .................................... 7.000 08/01/22 4,219,160
500 Lancaster, PA Indl Dev Auth Coml Rev First Mtg
Kmart Corp Ser A Rfdg ............................. 7.100 09/15/07 529,700

See Notes to Financial Statements
</TABLE>

Page 5

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Portfolio of Investments (Continued)

August 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
Par
Amount Market
(000) Description Coupon Maturity Value
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pennsylvania (Continued)
$ 4,000 Lehigh Cnty, PA Genl Purp Auth Rev Good Shepherd Rehab
Hosp ................................................... 7.500% 11/15/21 $ 4,120,080
5,500 Lehigh Cnty, PA Genl Purp Auth Rev Muhlenberg Hosp Ser
B ...................................................... 8.100 07/15/10 5,906,615
3,100 Montgomery Cnty, PA Higher Edl & Hlth Auth Hosp Rev
Abington Hosp (Embedded Cap) (AMBAC Insd) <F2> ......... 6.000 06/01/16 3,090,762
950 Montgomery Cnty, PA Higher Edl & Hlth Auth Hosp Rev
Pottstown Mem Med Cent Proj ............................ 7.000 11/15/99 1,008,225
1,250 Montgomery Cnty, PA Higher Edl & Hlth Auth Hosp Rev
Pottstown Mem Med Cent Proj ............................ 7.350 11/15/05 1,314,137
2,345 Montgomery Cnty, PA Higher Edl & Hlth Auth Hosp Rev
Pottstown Mem Med Cent Proj ............................ 6.875 11/15/20 2,334,916
6,000 Montgomery Cnty, PA Indl Dev Auth Rev Res Recovery ..... 7.500 01/01/12 6,453,300
2,000 Pennsylvania Econ Dev Fin Auth Exempt Fac Rev Macmillan
Ltd Partnership Proj ................................... 7.600 12/01/20 2,165,940
2,750 Pennsylvania Hsg Fin Agy Single Family Mtg Ser 27 (FHA
Gtd) ................................................... 8.100 10/01/10 2,950,200
1,000 Pennsylvania Hsg Fin Agy Single
Family Mtg Ser 34B (FHA Gtd) ........................... 7.000 04/01/24 1,041,750
2,000 Pennsylvania Hsg Fin Agy Single Family Mtg Ser 42 ...... 6.850 04/01/25 2,072,120
7,000 Pennsylvania Intergvtl Coop Auth Spl Tax Rev City of
Philadelphia (Prerefunded @ 06/15/02) .................. 6.800 06/15/22 7,884,240
17,015 Pennsylvania St Higher Edl Assistance Agy Student Ln
Rev Ser A (Prerefunded @ 10/01/01) (AMBAC Insd) ........ 7.050 10/01/16 17,966,649
1,000 Pennsylvania St Higher Edl Fac Auth College & Univ Rev
Hahnemann Univ Proj (MBIA Insd) ........................ 7.200 07/01/19 1,103,040
3,000 Pennsylvania St Higher Edl Fac Auth College & Univ Rev
Trustees Univ Ser A .................................... 6.625 01/01/17 3,052,530
2,200 Pennsylvania St Higher Edl Fac Auth Rev Med College PA
Ser A .................................................. 8.375 03/01/11 2,384,756
4,250 Philadelphia, PA Arpt Rev Ser A (AMBAC Insd) ........... 6.100 06/15/25 4,232,150
3,000 Philadelphia, PA Gas Wks Rev Ser 14 (FSA Insd) ......... 6.250 07/01/08 3,185,250
2,000 Philadelphia, PA Gas Wks Rev Ser 14 (Cap Guar Insd) .... 6.375 07/01/14 2,104,960
7,165 Philadelphia, PA Muni Auth Rev Justice Lease Ser B
(Prerefunded @ 11/15/01) (FGIC Insd) ................... 7.125 11/15/18 8,268,912
5,000 Philadelphia, PA Wtr & Swr Rev Ser 16 (Prerefunded @
08/01/01) .............................................. 7.500 08/01/10 5,802,800
5,500 Philadelphia, PA Wtr & Swr Rev Ser 16 (Prerefunded @
08/01/01) .............................................. 7.000 08/01/18 6,158,515
3,000 Philadelphia, PA Wtr & Wastewtr Rev (MBIA Insd) ........ 5.625 06/15/08 3,078,210
2,000 Philadelphia, PA Wtr & Wastewtr Rev (MBIA Insd) ........ 5.500 08/01/14 1,929,280

See Notes to Financial Statements
</TABLE>

Page 6

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Portfolio of Investments (Continued)

Total Long-Term Investments 98.5%
(Cost $183,659,566) <F1>...................................................... 197,319,375

Other Assets in Excess of Liabilities 1.5%.................................... 2,938,883
-------------
Net Assets 100%............................................................... $ 200,258,258
-------------
-------------
*Zero coupon bond

<FN>
<F1> At August 31, 1995, cost for federal income tax purposes is $183,659,566;
the aggregate gross unrealized appreciation is $13,878,047 and the
aggregate gross unrealized depreciation is $218,238, resulting in net
unrealized appreciation of $13,659,809.

<F2> An Embedded Cap security includes a cap strike level such that the coupon
payment may be supplemented by cap payments if the floating rate index
upon which the cap is based rises above the strike level. The price of
these securities may be more volatile than the price of a comparable
fixed rate security. The Trust invests in these instruments as a hedge
against a rise in the short-term interest rates which it pays on its
preferred shares.

</TABLE>

The following table summarizes the portfolio composition at August 31, 1995,
based upon quality ratings issued by Standard & Poor's. For securities not rated
by Standard & Poor's, the Moody's rating is used.

<TABLE>
<CAPTION>
Portfolio Composition by Credit Quality
<S> <C>
AAA........... 50.6%
AA............ 4.6
A............. 10.4
BBB........... 28.4
B............. 4.0
Non-Rated..... 2.0
-------
100.0%
-------
-------

</TABLE>
See Notes to Financial Statements

Page 7

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
Statement of Assets and Liabilities

August 31, 1995
- -------------------------------------------------------------------------------------------------------------

Assets:
<S> <C>
Investments, at Market Value (Cost $183,659,566) (Note 1)..................................... $ 197,319,375
Receivables:
Interest................................................................................... 3,352,683
Investments Sold........................................................................... 505,157
Unamortized Organizational Expenses (Note 1).................................................. 6,437
--------------
Total Assets............................................................................. 201,183,652
--------------
Liabilities:
Payables:
Custodian Bank............................................................................. 410,600
Income Distributions - Common and Preferred Shares......................................... 210,489
Investment Advisory Fee (Note 2)........................................................... 117,672
Administrative Fee (Note 2)................................................................ 33,621
Accrued Expenses.............................................................................. 153,012
--------------
Total Liabilities........................................................................ 925,394
--------------
Net Assets.................................................................................... $ 200,258,258
--------------
--------------
Net Assets Consist of:
Preferred Shares ($.01 par value, authorized 100,000,000 shares, 1,300 issued with
liquidation preference of $50,000 per share) (Note 5)...................................... $ 65,000,000
--------------
Common Shares ($.01 par value with an unlimited number of shares authorized,
8,096,647 shares issued and outstanding) (Note 3).......................................... 80,966

Paid in Surplus .............................................................................. 119,701,364
Net Unrealized Appreciation on Investments.................................................... 13,659,809
Accumulated Undistributed Net Investment Income............................................... 1,732,284
Accumulated Net Realized Gain on Investments.................................................. 83,835
--------------
Net Assets Applicable to Common Shares................................................... 135,258,258
--------------
Net Assets.................................................................................... $ 200,258,258
--------------
--------------
Net Asset Value Per Common Share ($135,258,258 divided by 8,096,647 shares outstanding)....... $ 16.71
--------------
--------------
See Notes to Financial Statements

</TABLE>

Page 8

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Statement of Operations

For the Year Ended August 31, 1995
- --------------------------------------------------------------------------------
<S> <C>
Investment Income:
Interest........................................................ $ 13,008,827
---------------
Expenses:
Investment Advisory Fee (Note 2)................................ 1,357,838
Administrative Fee (Note 2)..................................... 387,954
Preferred Share Maintenance (Note 5)............................ 175,705
Legal (Note 2).................................................. 36,005
Trustees Fees and Expenses (Note 2)............................. 19,327
Amortization of Organizational Expenses (Note 1)................ 5,993
Other........................................................... 254,453
---------------
Total Expenses............................................. 2,237,275
---------------
Net Investment Income........................................... $ 10,771,552
---------------
---------------
Realized and Unrealized Gain/Loss on Investments:
Realized Gain/Loss on Investments:
Proceeds from Sales.......................................... $ 28,308,938
Cost of Securities Sold...................................... (28,225,103)
---------------
Net Realized Gain on Investments ............................... 83,835
---------------
Unrealized Appreciation/Depreciation on Investments:
Beginning of the Period...................................... 10,902,654
End of the Period............................................ 13,659,809
---------------
Net Unrealized Appreciation on Investments During the Period.... 2,757,155
---------------
Net Realized and Unrealized Gain on Investments................. $ 2,840,990
---------------
---------------
Net Increase in Net Assets from Operations...................... $ 13,612,542
---------------
---------------

</TABLE>
See Notes to Financial Statements

Page 9

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
Statement of Changes in Net Assets

For the Years Ended August 31, 1995 and 1994
- -----------------------------------------------------------------------------------------------------
Year Ended Year Ended
August 31, 1995 August 31, 1994
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>
From Investment Activities:
Operations:
Net Investment Income.............................................. $ 10,771,552 $ 10,793,624
Net Realized Gain on Investments................................... 83,835 20,025
Net Unrealized Appreciation/Depreciation on Investments
During the Period............................................... 2,757,155 (12,467,120)
--------------- ---------------
Change in Net Assets from Operations .............................. 13,612,542 (1,653,471)
--------------- ---------------
Distributions from Net Investment Income:
Common Shares................................................... (8,829,797) (8,806,930)
Preferred Shares................................................ (2,525,157) (1,726,520)
--------------- ---------------
(11,354,954) (10,533,450)
--------------- ---------------
Distributions from Net Realized Gain on Investments:
Common Shares................................................... (16,968) (310,345)
Preferred Shares................................................ (3,068) (43,060)
--------------- ---------------
(20,036) (353,405)
--------------- ---------------
Total Distributions................................................ (11,374,990) (10,886,855)
--------------- ---------------
Net Change in Net Assets from Investment Activities................ 2,237,552 (12,540,326)
From Capital Transactions (Note 3):

Value of Common Shares Issued Through Dividend Reinvestment........ 335,636 232,244
--------------- ---------------
Total Increase/Decrease in Net Assets.............................. 2,573,188 (12,308,082)

Net Assets:
Beginning of the Period............................................ 197,685,070 209,993,152
--------------- ---------------
End of the Period (Including undistributed net investment income
of $1,732,284 and $2,315,686, respectively...................... $ 200,258,258 $ 197,685,070
--------------- ---------------
--------------- ---------------
</TABLE>
See Notes to Financial Statements

Page 10

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
Financial Highlights
The following schedule presents financial highlights for one common share
of the Trust outstanding throughout the periods indicated.
- ------------------------------------------------------------------------------------------
September 27, 1991
(Commencement
Year Ended August 31 of Investment
----------------------------- Operations) to
1995 1994 1993 August 31, 1992
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value,
Beginning of the Period <F1>........ $ 16.431 $ 17.987 $ 16.387 $ 14.788
---------- ----------- ---------- ----------
Net Investment Income............... 1.331 1.338 1.344 1.092
Net Realized and Unrealized
Gain/Loss on Investments.......... .349 (1.544) 1.685 1.460
---------- ----------- ---------- ----------
Total from Investment Operations....... 1.680 (.206) 3.029 2.552
---------- ----------- ---------- ----------
Less:
Distributions from Net
Investment Income:
Paid to Common Shareholders....... 1.092 1.092 1.042 .754
Common Share Equivalent of
Distributions Paid to
Preferred Shareholders.......... .312 .214 .186 .199
Distributions from Net Realized
Gain on Investments:
Paid to Common Shareholders....... .002 .039 .161 -0-
Common Share Equivalent of
Distributions Paid to
Preferred Shareholders.......... -0- .005 .040 -0-
---------- ----------- ---------- ----------
Total Distributions.................... 1.406 1.350 1.429 .953
---------- ----------- ---------- ----------
Net Asset Value, End of the Period..... $ 16.705 $ 16.431 $ 17.987 $ 16.387
---------- ----------- ---------- ----------
---------- ----------- ---------- ----------
Market Price Per Share
at End of the Period................ $ 16.250 $ 16.125 $ 17.625 $ 15.750
Total Investment Return at
Market Price (Non-Annualized) <F2>.. 8.02% (2.22%) 20.26% 10.22%
Total Return at Net Asset Value
(Non-Annualized) <F3>............... 8.90% (2.45%) 17.85% 14.65%
Net Assets at End of the Period
(In millions)....................... $ 200.3 $ 197.7 $ 210.0 $ 197.0
Ratio of Expenses to Average
Net Assets Applicable to
Common Shares (Annualized).......... 1.73% 1.64% 1.64% 1.58%
Ratio of Expenses to Average
Net Assets (Annualized)............. 1.15% 1.12% 1.11% 1.11%
Ratio of Net Investment Income to
Average Net Assets
Applicable to Common Shares
(Annualized) <F4>................... 6.37% 6.54% 6.85% 6.28%
Portfolio Turnover..................... 14.69% .96% 4.38% 55.37%

<FN>
<F1> Net asset value at September 27, 1991, is adjusted for common and
preferred share offering costs of $.212 per common share.

<F2> Total Investment Return at market price reflects the change in market
value of the common shares for the period indicated with reinvestment
of dividends in accordance with the Trust's dividend reinvestment plan.

<F3> Total return at net asset value (NAV) reflects the change in value of the
Trust's assets with reinvestment of dividends based upon NAV.

<F4> Net investment income is adjusted for common share equivalent of
distributions paid to preferred shareholders.

</TABLE>
See Notes to Financial Statements

Page 11

- --------------------------------------------------------------------------------
Notes to Financial Statements

August 31, 1995
- --------------------------------------------------------------------------------

1. Significant Accounting Policies
Van Kampen Merritt Pennsylvania Quality Municipal Trust (the "Trust") is
registered as a non-diversified closed-end management investment company under
the Investment Company Act of 1940, as amended. The Trust commenced investment
operations on September 27, 1991.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements.

A. Security Valuation---Investments are stated at value using market quotations
or, if such valuations are not available, estimates obtained from yield data
relating to instruments or securities with similar characteristics in accordance
with procedures established in good faith by the Board of Trustees. Short-term
securities with remaining maturities of less than 60 days are valued at
amortized cost.

B. Security Transactions---Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis.
The Trust may purchase and sell securities on a "when issued" or
"delayed delivery" basis, with settlement to occur at a later date. The value
of the security so purchased is subject to market fluctuations during this
period. The Trust will maintain, in a segregated account with its custodian,
assets having an aggregate value at least equal to the amount of the when issued
or delayed delivery purchase commitments until payment is made. At August 31,
1995, there were no when issued or delayed delivery purchase commitments.

C. Investment Income---Interest income is recorded on an accrual basis. Bond
premium and original issue discount are amortized over the expected life of each
applicable security.

D. Organizational Expenses---The Trust has reimbursed Van Kampen American
Capital Distributors, Inc. or its affiliates (collectively "VKAC") for costs
incurred in connection with the Trust's organization and initial registration in
the amount of $30,000. These costs are being amortized on a straight line basis
over the 60 month period ending September 26, 1996. Van Kampen American Capital
Investment Advisory Corp. (the "Adviser") has agreed that in the event any of
initial shares of the Trust originally purchased by VKAC are redeemed
during the amortization period, the Trust will be reimbursed for any
unamortized organizational expenses in the same proportion as the number of
shares redeemed bears to the number of initial shares held at the time of
redemption.

Page 12

- --------------------------------------------------------------------------------
Notes to Financial Statements (Continued)

August 31, 1995
- --------------------------------------------------------------------------------

E. Federal Income Taxes---It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes is required.
Net realized gains or losses may differ for financial and tax reporting
purposes primarily as a result of post October 31 losses which may not be
recognized for tax purposes until the first day of the following fiscal year.

F. Distribution of Income and Gains---The Trust declares and pays monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are distributed annually on a pro rata basis to common and preferred
shareholders. Distributions from net realized gains for book purposes may
include short-term capital gains which are included as ordinary income for tax
purposes.

2. Investment Advisory Agreement and Other Transactions with Affiliates
Under the terms of the Trust's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Trust for an annual fee payable
monthly of .70% of the average net assets of the Trust. In addition, the Trust
will pay a monthly administrative fee to VKAC, the Trust's Administrator, at an
annual rate of .20% of the average net assets of the Trust. The administrative
services provided by the Administrator include record keeping and reporting
responsibilities with respect to the Trust's portfolio and preferred shares
and providing certain services to shareholders.
Certain legal expenses are paid to Skadden, Arps, Slate, Meagher & Flom,
counsel to the Trust, of which a trustee of the Trust is an affiliated person.
For the year ended August 31, 1995, the Trust recognized expenses of
approximately $18,200 representing VKAC's cost of providing accounting and legal
services to the Trust.
Certain officers and trustees of the Trust are also officers and directors of
VKAC. The Trust does not compensate its officers or trustees who are officers of
VKAC.
The Trust has implemented deferred compensation and retirement plans for its
trustees. Under the deferred compensation plan, trustees may elect to defer
all or a portion of their compensation to a later date. The retirement plan
covers those trustees who are not officers of VKAC. The Trust's liability
under the deferred compensation and retirement plans at August 31, 1995,
was approximately $22,800.

Page 13

- --------------------------------------------------------------------------------
Notes to Financial Statements (Continued)

August 31, 1995
- --------------------------------------------------------------------------------

At August 31, 1995, VKAC owned 6,700 common shares of the Trust.

3. Capital Transactions
At August 31, 1995 and 1994, paid in surplus related to common shares aggregated
$119,701,364 and $119,365,942, respectively.
Transactions in common shares were as follows:

<TABLE>
<CAPTION>
Year Ended Year Ended
August 31, 1995 August 31, 1994

- -----------------------------------------------------------
<S> <C> <C>
Beginning Shares......... 8,075,216 8,060,902
Shares Issued Through
Dividend Reinvestment.... 21,431 14,314
--------------- ---------------
Ending Shares............ 8,096,647 8,075,216
--------------- ---------------
--------------- ---------------
</TABLE>

4. Investment Transactions

Aggregate purchases and cost of sales of investment securities, excluding
short-term notes, for the year ended August 31, 1995, were $28,079,619 and
$28,225,103, respectively.

5. Preferred Shares
The Trust has outstanding 1,300 Auction Preferred Shares ("APS"). Dividends are
cumulative and the rate is currently reset through an auction process every 28
days. The rate in effect on August 31, 1995, was 3.85% and for the year ended
August 31, 1995, the rates ranged from 3.15% to 4.25%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of Preferred Share Maintenance
expense.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $50,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests, and the APS are subject to
mandatory redemption if the tests are not met.

Page 14

- --------------------------------------------------------------------------------
Independent Auditors' Report
- --------------------------------------------------------------------------------
The Board of Trustees and Shareholders of
Van Kampen Merritt Pennsylvania Quality Municipal Trust:

We have audited the accompanying statement of assets and liabilities of Van
Kampen Merritt Pennsylvania Quality Municipal Trust (the "Trust"), including the
portfolio of investments, as of August 31, 1995, and the related statement of
operations for the year then ended, the statement of changes in net assets for
each of the two years in the period then ended, and the financial highlights for
each of the periods presented. These financial statements and financial
highlights are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
August 31, 1995, by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Van
Kampen Merritt Pennsylvania Quality Municipal Trust as of August 31, 1995, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended, and the financial highlights
for each of the periods presented, in conformity with generally accepted
accounting principles.

KPMG Peat Marwick LLP
Chicago, Illinois
October 3, 1995

Page 15

- --------------------------------------------------------------------------------
Dividend Reinvestment Plan
- --------------------------------------------------------------------------------

The Trust offers a dividend reinvestment plan (the "Plan") pursuant to which
Common Shareholders may elect to have dividends and capital gains distributions
reinvested in Common Shares of the Trust. The Trust declares dividends out of
net investment income, and will distribute annually net realized capital gains,
if any. Common Shareholders may join or withdraw from the Plan at any time.
If you decide to participate in the Plan, State Street Bank and Trust Company,
as your Plan Agent, will automatically invest your dividends and capital gains
distributions in Common Shares of the Trust for your account.

How to Participate
If you wish to participate and your shares are held in your own name, call
1-800-341-2929 for more information and a Plan brochure. If your shares are held
in the name of a brokerage firm, bank, or other nominee, you should contact your
nominee to see if it would participate in the Plan on your behalf. If you wish
to participate in the Plan, but your brokerage firm, bank or nominee is unable
to participate on your behalf, you should request that your shares be
re-registered in your own name which will enable your participation in the Plan.

How the Plan Works
Participants in the Plan will receive the equivalent in Common Shares valued on
the valuation date, generally at the lower of market price or net asset value,
except as specified below. The valuation date will be the dividend or
distribution payment date or, if that date is not a trading day on the national
securities exchange or market system on which the Common Shares are listed for
trading, the next preceding trading day. If the market price per Common Share on
the valuation date equals or exceeds net asset value per Common Share on that
date, the Trust will issue new Common Shares to participants valued at the
higher of net asset value or 95% of the market price on the valuation date. In
the foregoing situation, the Trust will not issue Common Shares under the Plan
below net asset value. If net asset value per Common Share on the valuation date
exceeds the market price per Common Share on that date, or if the Board of
Trustees should declare a dividend or capital gains distribution payable to the
Common Shareholders only in cash, participants in the Plan will be deemed to
have elected to receive Common Shares from the Trust valued at the market price
on that date. Accordingly, in this circumstance, the Plan Agent will, as agent
for the participants, buy the Trust's Common Shares in the open market for the
participants' accounts on or shortly after the payment date. If, before the Plan
Agent has completed its purchases, the market price exceeds the net asset value
per share of the Common Shares, the average per share purchase price paid by the
Plan Agent may exceed the net asset value of the Trust's Common Shares,
resulting in the acquisition of fewer Common Shares than if the dividend or
distribution had been paid in Common Shares issued by the Trust. All
reinvestments are in full and fractional Common Shares and are carried to three
decimal places.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of the
changes sent to all Common Shareholders of the Trust at least 90 days before the
record date for the dividend or distribution. The Plan also may be amended or
terminated by the Plan Agent by at least 90 days written notice to all Common
Shareholders of the Trust.

Costs of the Plan
The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. No other charges will be made to participants for
reinvesting dividends or capital gains distributions, except for certain
brokerage commissions, as described above.

Tax Implications
You will receive tax information annually for your personal records and to help
you prepare your federal income tax return. The automatic reinvestment of
dividends and capital gains distributions does not relieve you of any income
tax which may be payable on dividends or distributions.

Right to Withdraw
Plan participants may withdraw at any time by calling 1-800-341-2929 or by
writing State Street Bank and Trust Company, P.O. Box 8200, Boston, MA
02266-8200. If you withdraw, you will receive, without charge, a share
certificate issued in your name for all full Common Shares credited to your
account under the Plan and a cash payment will be made for any fractional Common
Share credited to your account under the Plan. You may again elect to
participate in the Plan at any time by calling 1-800-341-2929 or writing to the
Trust at:
One Parkview Plaza, Oakbrook Terrace, IL 60181
Attn: Closed-End Funds

Page 16

- --------------------------------------------------------------------------------
Funds Distributed by Van Kampen American Capital
- --------------------------------------------------------------------------------

GLOBAL AND INTERNATIONAL
Global Equity Fund
Global Government Securities Fund
Global Managed Assets Fund
Short-Term Global Income Fund
Strategic Income Fund

EQUITY
Growth
Emerging Growth Fund
Enterprise Fund
Pace Fund
Growth & Income
Balanced Fund
Comstock Fund
Equity Income Fund
Growth and Income Fund
Harbor Fund
Real Estate Securities Fund
Utility Fund

FIXED INCOME
Corporate Bond Fund
Government Securities Fund
High Income Corporate Bond Fund
High Yield Fund
Limited Maturity Government Fund
Prime Rate Income Trust
Reserve Fund
U.S. Government Fund
U.S. Government Trust for Income

TAX-FREE
California Insured Tax Free Fund
Florida Insured Tax Free Income Fund
High Yield Municipal Fund
Insured Tax Free Income Fund
Limited Term Municipal Income Fund
Municipal Income Fund
New Jersey Tax Free Income Fund
New York Tax Free Income Fund
Pennsylvania Tax Free Income Fund
Tax Free High Income Fund
Tax Free Money Fund
Texas Tax Free Income Fund

THE GOVETT FUNDS
Emerging Markets Fund
Global Income Fund
International Equity Fund
Latin America Fund
Pacific Strategy Fund
Smaller Companies Fund

Ask your investment representative for a prospectus containing more complete
information, including sales charges and expenses. Please read it carefully
before you invest or send money. Or call us direct at 1-800-421-5666 weekdays
from 7:00 a.m. to 7:00 p.m. Central time.

Page 17

- --------------------------------------------------------------------------------
Van Kampen Merritt Pennsylvania Quality Municipal Trust
- --------------------------------------------------------------------------------
Officers and Trustees

Don G. Powell*
Chairman and Trustee

Dennis J. McDonnell*
President and Trustee

David C. Arch
Trustee

Rod Dammeyer
Trustee

Howard J Kerr
Trustee

Theodore A. Myers
Trustee

Hugo F. Sonnenschein
Trustee

Wayne W. Whalen*
Trustee

Peter W. Hegel*
Vice President

Ronald A. Nyberg*
Vice President and Secretary

Edward C. Wood, III*
Vice President and Treasurer

Scott E. Martin*
Assistant Secretary

Weston B. Wetherell*
Assistant Secretary

Nicholas Dalmaso*
Assistant Secretary

John L. Sullivan*
Controller

Steven M. Hill*
Assistant Treasurer

Investment Adviser

Van Kampen American Capital
Investment Advisory Corp.
One Parkview Plaza
Oakbrook Terrace, Illinois 60181

Custodian and
Transfer Agent

State Street Bank
and Trust Company
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02105

Legal Counsel

Skadden, Arps, Slate, Meagher & Flom
333 West Wacker Drive
Chicago, Illinois 60606

Independent Auditors

KPMG Peat Marwick LLP
Peat Marwick Plaza
303 East Wacker Drive
Chicago, Illinois 60601

*"Interested" persons of the Trust, as defined in the
Investment Company Act of 1940.

SM denotes a service mark of
Van Kampen American Capital Distributors, Inc.

Page 18