STATE And LOCAL SALES And USE TAX - Kencove

Collection of Tax: tax must be collected at the timeof sale of property unless the sale is on credit. taxon credit sales must be collected within 30 days fromthe date of the sale. A seller is liable for reportingand remitting tax with the tax return covering theperiod in which either a taxable purchase was madeor tax should have been collected. the seller may beassessed for failure to collect tax.Purchase Price: tax is to be collected on the fullpurchase price without deduction of charges forlabor, handling, delivery or installation. Separatelystated charges clearly designated as deposits forreturnable containers transferred to the ultimateconsumer of the product are not subject to tax.however, if the deposit is designated as a rental, thecharge is subject to tax.Tax Rate: the 6 percent state sales tax is to be collected on every separate taxable sale in accordancewith the tax table on page 19. An additional 1 percent local tax applies to items purchased or used inAllegheny County; 2 percent local tax applies toitems purchased or first used in philadelphia.Tax Returns: Upon registration, the departmentprovides sales tax licensees with a schedule forreporting periods within a calendar year. no licenseeshall be excused for failure to report and pay the tax.tax returns must be filed for every reporting period,even if no tax is due.MONTHLy RETURNSlicensees whose total tax liability is less than 25,000, but greater than 600 per quarter,must file monthly. monthly returns are due the20th day of the month which follows the monthin which the tax was collected.Monthly with Prepayment Requirement: thecurrent month’s prepayment and the prior month’sreturn and payment are due on the 20th of themonth.Methods to calculate prepayments: if your liability for the third quarter of the previous year (July,August and September) was 25,000 or more but lessthan 100,000, you must remit sales, use and hoteloccupancy tax prepayments, you may calculate theprepayment due by either of the following calculationmethods: 50 percent of the actual tax liability for thesame month of the previous year, or at least 50 percent of the actual tax liability for the current period.8

if your liability for the third quarter of the previousyear (July, August and September) was 100,000 ormore, you must remit 50 percent of the actual taxliability for the same month of the previous year.QUARTERLy RETURNSlicensees whose total tax liability is less than 600 in the third calendar quarter, but greaterthan 300 annually, must file quarterly.Quarterly returns are due:PeriodDueJanuary - marchApril 20April - JuneJuly 20July - Septemberoctober 20october - decemberJanuary 20SEMI-ANNUAL RETURNSlicensees whose total tax liability is 300 or lessannually must file semi-annually.Semi-annual returns are due:PeriodDueFirst Six monthsAugust 20Second Six monthsFebruary 20Electronic Filing e-TideS (Electronic Tax Information and DataExchange System): e-TIDES is a business tax filingsystem available free of charge to all registeredsales and use tax account holders. Sales and usetax returns and payments can be made throughe-TIDES by accessing www.etides.state.pa.us. TeleFile: teleFile is a fast and secure way to fileand pay sales and use tax by phone. Call, tollfree, 1-800-748-8299 using a touch-tonetelephone. Third-Party Vendors: Approved third-partyvendors provide for secure transmission for filingand paying sales and use tax. Visitwww.revenue.pa.gov to learn more about thiselectronic filing option.Electronic Funds Transfer (EFT): All businessesare encouraged to explore this electronic paymentoption. taxpayers remitting payment of 1,000 ormore are required to do so by electronic funds transfer (EFt). Failure to make such payment by an approved EFt method may result in the imposition of apenalty of 3 percent of the tax due, up to 500.9

All tax documents are still required to be filed evenwhen payments are made through EFt.to register, visit www.etides.state.pa.us.Cooperative Agricultural Associations Exemption: Cooperative agricultural associations, whichare required to pay corporate net income tax, areexempt from the payment of sales and use tax onpurchases of tangible personal property and services. however, the exemption does not apply to thepurchase, lease, repair or the maintenance serviceof any motor vehicle required to be registered underthe provisions of the Vehicle Code.the exemption does not pass to a construction contractor who, pursuant to a construction contract witha cooperative agricultural association, is required topurchase materials, supplies or equipment installedso as to become part of the real estate.AGRICULTURAL SERVICESPERFORMED FOR FARMERSAnimal and Poultry Feedindividuals or businesses dealing in the preparationof animal or poultry feed for farmers will fall into oneof the following categories: those predominantly engaged in the business ofpreparing their own animal or poultry feed forsale qualify for sales tax exemption as a processor. grinding and mixing equipment, notincluding vehicles to transport the equipment,may be purchased free from tax by filing a properly completed exemption certificate with thevendor. those predominantly engaged in the business ofpreparing animal or poultry feed belonging toanother (individual or business) do not qualify asa processor. therefore, their purchases of equipment and vehicles to transport the equipmentare subject to sales and use tax.LIST OF TAXABLEAND NONTAXABLE ITEMST – taxable: items not normally used directly infarming.NT – nontaxable: items that are normally useddirectly in farming.10

NOTE: For items not normally used directly in farming that were purchased tax-free, a farmer shouldnotate the invoice reflecting the reason for exemption, and maintain the invoice and exemptioncertificate.t – Acetylenent – Air compressorsnt – Air conditioning, if used to preserve farmproducts prior to packaging (taxable ifused primarily for the comfort of farmpersonnel or to preserve the farm product after the final packaging operation)nt – Air tanksnt – Alternator (auxiliary) if used to operatefarm equipmentnt – Anhydrous ammonia tanks and fittingsnt – Artificial insemination equipment andsupplies, if used for the breeding of productive animalsnt – Augersnt – Automated milking equipmentnt – balersnt – barn cleanersnt – bedding for productive animalsnt – beekeeper supplies and equipmentincluding, but not limited to bees, beehives and wax foundationsnt – bindersnt – blacksmith/farrier services for commercial racehorses or horses used directly infarmingnt – blankets when used to preserve thehealth of productive animalsnt – blowersnt – boarding of animalsnt – bootsnt – breeding services for productive animalsnt – brooderst – brooms, general cleanlinessnt – brooms, used to clean mushroom bedst – bucketsnt – buckets for handling farm products11

t – building supplies, including, but notlimited to materials to build barnsnt – bulbs for plantingt – Cabinetsnt – Cabs installed on farm tractorsnt – Calf weanersnt – Cans, feedingnt – Cattle currying and oiling machinesnt – Cattle feedersnt – Cattle chutes (portable)nt – Cement, if used to construct liquidmanure pits, silo flooring and foundationsfor exempt machinery and equipmentt – Cement, if used for other than abovet – Chain hoists used as maintenance equipmentt – Chain saws (Chain saws are considerednontaxable only if used by a sawmilloperator or planing mill operator for thepurpose of cutting or hauling logs.)nt – Chemicals used for pest control or to cleanand sterilize exempt farm equipmentnt – Chicken pickersnt – Cleaners and disinfectants used in cleaning milking equipment and to sterilizemilk cans to prevent spoilage. propertyused for general farm cleaning and maintenance is taxable.nt – Clippers or clipping machines for use onproductive animalsnt – Combinest – Computerst – Computer software, cannednt – Containers: non-returnable wrapping supplies used for delivery of any personalpropertyt – Containers: milk, reusablent – Conveyors (elevators, hay and grain,self-generated)nt – Corn crib (portable)nt – Corn pickersnt – Corn shuckersnt – Coveralls12

��––ntntnttnt–––––t –nt –nt –t –t –nt –nt –nt –tntntntt–––––Crates, fieldCultivatorsCutter, ensilagedebeakers for productive animalsdefoliantsdehorners for productive animalsdisinfectantsdozer blades for land reclamationdragsdrainage pipedrills for repair and maintenance activitiesdrugs and medicines for animals, birds orfishdrying machines for graindustersdusting compoundsEducational materialsEgg candling, collecting, washing andprocessing equipmentElectric fence chargersElectric insect killers, if intended for usein an area in which farm animals or products are storedElectricity to operate farm equipment orinterior barn lightingElectricity for operating exterior lightingEquipment and supplies for home use orpersonal useEquipment used to extract a productfrom productive animals or from the soilFeed and feed additives for productiveanimals, game birds or fishFeeding equipment, including, but notlimited to bowls, buckets, cans, carts,tubs, food scoops, grinders and wateringdevices for productive animals or gamebirdsFencingFertilizer distributorsFertilizers and chemical additives for soilField sprayersFire prevention and safety equipment13

nt – Firewoodnt – Fish hatchery stock and feed when apropagation permit is heldt – Flowersnt – Fork liftsnt – Fuel oil for use in heating poultry brooders, incubators and greenhousest – Fuel oil tanksnt – Fumigation services upon agriculturalcommodities or containers used for agricultural commoditiesnt – Fungicidest – garden tractors, unless used in the farming operationnt – generators (auxiliary) only if they provide emergency service to preventspoilage of foodnt – glovesnt – graders used to grade eggs, vegetablesand fruitnt – grain bins, both permanent and portable,if used predominantly to store farm selfgenerated grain for productive farmanimals, game birds or fisht – grain bins, if predominantly used to storepurchased grain or grain for salent – grain drills used for seeding farm landnt – grain elevators (portable)nt – grain plantersnt – grating for hog pen flooringt – greenhousesnt – grooming materials, equipment and supplies when necessary for the health ofproductive animalsnt – growing media (artificial)t – guns and ammunitionnt – harnesses used to control productive animalst – harnesses used for exhibition or transportation purposesnt – harrowsnt – harvestersnt – hay conditioners14

�–––––––nt –nt –nt –t –nt –t –nt –nt –hay mowershay rackshay rakeshay teddershay windrowersheaters for milk house, including waterheatershelp Supplyherbicideshog feedershoof trimmers for productive animalshormones for productive animalshorsefeedhusking machineshydraulic hoist installed on a vehicleiceincubatorsinsecticides for use on cropsirrigation pipes and pumpslanternslight bulbs for chicken coopslight bulbs for general lightinglimelivestocklog splitters and timber equipmentlumbermaintenance facilities including tools,machinery and equipment to maintainmachinery, equipment or propertymanure handling equipment, including,but not limited to spreaders, front-endloaders and scrappersmanure storage tanksmedicines, serums, and solutions used inthe care of animals, birds or fishmilk cansmilk strainers, strainer discs and towelsmilk strainer dispensers, strainer discsdispensers and towel dispensersmilk tanks, bulkmilking machines, including piping15

nt – mowers, haynt – mulchesnt – mushroom equipment, machines andpartst – mushroom housest – nailsnt – nests, poultry (portable)nt – nursery equipment, machines and partst – office supplies and equipmentt – oilerst – oxygennt – pailst – paint and paint supplies, general usent – paint and paint supplies for use onexempt equipmentnt – pallets and pallet boxnt – paper towels for washing udders of cattlent – peat mossnt – pens (portable)nt – pest Control services for agriculturalservicesnt – pesticidet – pet foodnt – picking equipmentnt – pipes to supply water to barn or to waterproductive animals, game birds or cropsnt – pitchforknt – plantersnt – plantsnt – plowst – post hole diggersnt – poultry house equipment, including, butnot limited to nests, feeders and waterersnt – productive animalsnt – pruning equipmentnt – pumps for use in farm irrigation or watering productive animals or game birdst – Radiosnt – Refrigeration or cooling equipment usedto store and preserve farm productst – Road maintenance equipment16

ntntntnt––––t –nt –t –nt –t –nt –nt –ntntntnttntnt–––––––nt –nt –nt –nt –nt –t –t –nt t plantersRotary hoesSacks and bags when used as wrappingsuppliesSafety equipment, unless worn by production personnelSalt blocks for use by productive animalsSandersSaw dust and wood chips used for animalbeddingScalesSeeds and seedersSemen used for the breeding of productive animalsSerums for use on animals, birds or fishShovelsSilage unloaderSilosSnow plows and equipmentSoil conditionersSprayers used to clean eggs, chickens,etc., prior to packagingStalls for productive animalsStanchionsSteel bodies mounted on farm wagons todry hay by portable dryersStone pickersStorage tanks for manureStud fees except where the animals aredirectly used in farm operationstanks, fuel oiltarpaulins to protect or preserve farmproductsthresherstiestire spreaderstires used on agricultural implementstires used on nonagricultural implementstobacco seed and tobacco papertoilets, field17

t – toolsnt – topsoilnt – tractors and accessoriesnt – troughnt – tubsnt – twinent – Vaccines for animals, birds or fishnt – Ventilation fans and equipmentnt – Veterinarian services for animals, birdsand fishnt – Washers for fruit, vegetable and eggt – Water heater for cleaning dairy equipment and suppliesnt – Watering devicesnt – Waxers for fruits and vegetablesnt – Weaners for productive animalsnt – Weed spray used to protect farm cropst – Welding equipmentnt – Welding rods for use in repairing exemptfarm equipmentnt – Wheelbarrowst – Windowsnt – Wire for bailingt – Wire for fencingt – Wood stovest – Wrenches for maintenance activitiesnt – Wrapping supplies and containers thatare non-returnable and used to deliverself-produced farm products18

SALES AND USE TAX RATES6% RATESFrom .50.51.52.53.54.55.56.57.58.59.60AmountTax 0003000 4.0030.0036.0042.0048.0054.0060.00120.00180.00If the purchase price is more than 10, 6 percent and 1 percent or 2 percent county tax (if applicable), of each dollar plus the above bracketcharges upon any fractional part of a dollar must be collected.REV-221 AS (11-09)CONTINUED PAGE 2019

SALES AND USE TAX RATES1% RATESFrom 3.04.05.06.07.08.09.10From 6.767.267.768.268.769.269.76(Continued)2% 19.20

www.revenue.pa.gov

farmer must complete a pA Exemption Certificate (REV-1220) for the supplier. Farmers are not required to obtain a sales tax license number or sub - mit a sales tax license number to a supplier prior to receiving a sales tax exemption on purchases of tax-exempt tangible personal property directly used in farming operations. one exemption .