Pennsylvania – Reducing Pennsylvania’s Sales Tax

The Sentinel
Bill Tracker
by Joshua Vaughn
November 30, 2017

Each legislative session thousands of bills and amendments are introduced in the Pennsylvania Legislature. Only a fraction become law, and an even smaller portion receive wide media coverage.

These bills impact the lives of people living in Pennsylvania every day.

Each week The Sentinel will highlight one bill that has not received widespread attention.

About the bill

As the saying goes, there are two certainties in life: death and taxes.

Rep. Russ Diamond, R-Lebanon County, while not tackling the death issues, is looking to simplify how residents pay taxes.

“It’s time we put an end to the sales tax jigsaw puzzle that pits Pennsylvanian against Pennsylvanian and adopt instead a modernized level playing field, which acknowledges the realities of our economy and the fact that we’re all in this together,” Diamond wrote in a co-sponsorship letter.

Diamond introduced a package of bills that, among other provisions, would reduce Pennsylvania’s sales-and-use tax from the current 6 percent to 1.9 percent.

This would make the state’s sales tax significantly lower than almost of all of the surrounding states, which range from 8.49 percent in New York to 6 percent in Maryland.

Delaware has no sales tax.

Diamond wrote that lowering Pennsylvania’s sales tax would help reduce “border bleed” where shoppers cross into Delaware to avoid sales tax on purchases they could make in Pennsylvania.

House Bills 1905 would eliminate all exemptions to the state sale-and-use tax, including things like groceries and clothing.

According to Diamond, groceries are subject to state or local sales tax in 19 states and clothing is a taxable good in 38 states.

The sales-and-use tax would remain a tax on the end users and would keep exemptions for goods and services purchased at resale.

“This effort is aimed at simplifying the system, reducing retailer confusion, recognizing the realities of our economy, and making our commonwealth more competitive with surrounding states,” Diamond wrote.

For More Information:
The Sentinel/Bill Tracker
HB 1905