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Pennsylvania Use Tax Revenue Not What Expected


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Last year, a Pennsylvania state bill passed that required, “…all companies with a physical presence in the state [to] collect use taxes, including online retailers,” to begin collecting September 2012.

In addition to the new collection responsibilities for online retailers, taxpayers in the state “…are supposed to start reporting – and paying – taxes on items they buy online, via catalogs or at stores outside the state.”

The state of Pennsylvania estimated they would collect $5.1 million in use tax this year. So far, “[a]s of April 23, a revenue department spokeswoman said that $3.3 million was collected.” This was not as much as was expected by this time, but it might be too early to tell as income tax returns roll in.

With these indicators, “Revenue Secretary Dan Meuser is bracing for disappointment in the first year’s collection of the ‘use tax’—the equivalent of the 6 percent sales tax on Web purchases or items bought outside the state.”

As for the internet sales tax, Amazon is an online retailer that qualifies with physical presence in the state—it operates distribution facilities in Pennsylvania. Meuser is expecting online retailer collections to generate roughly $43 million for next year’s budget.

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Avalara Author
Susan McLain
Avalara Author Susan McLain
Susan McLain began her career as a technical writer in technology industries such as satellite networking and medical devices. Her skills encompass technical and marketing writing, usability engineering, verification and validation testing and protocol writing, requirements development, business analysis, technical illustration/graphic design and marketing. She has owned her own business providing service to small to medium sized business and in other positions, she has been in project management, documentation and marketing. She is currently the content specialist for Avalara helping to “make sales tax less taxing.”