An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in sales and use tax, further providing for exclusions from tax.

2025-2026 Regular Session Introduced by Aaron Bernstine and 10 co-sponsors

HB 2522 would update Pennsylvania sales and use tax exclusions to provide targeted relief or exemptions for specific goods, services, or activities.

Referred to Finance

Overview

HB 2522 (2025-2026) from Pennsylvania proposes amendments to the Tax Reform Code of 1971, specifically updating provisions related to sales and use tax exclusions. The bill is sponsored by a group of legislators including primary sponsor and several co-sponsors. The exact text of the bill is not provided here, so this summary focuses on the typical structure and likely areas of change based on the bill’s title and jurisdiction.

Purpose and intent

Clarify, expand, or modify exclusions from Pennsylvania sales and use tax.

Provide targeted tax relief or targeted exemptions to certain goods, services, or economic activities.

Align exclusions with policy goals such as supporting consumers, businesses, or specific industries.

Improve administration or simplify eligibility criteria for exemptions.

Key provisions (anticipated areas)

While the precise text is not provided, amendments to exclusions commonly address:

Expansion or modification of exemptions for certain categories of purchases (e.g., essentials, medical devices, groceries, clothing, or energy-related equipment).

Creation or revision of exemptions for specific transactions (e.g., non-profit organizations, government entities, or certain nonprofit activities).

Conditions and limits on exemptions (e.g., income thresholds, use restrictions, or resale criteria).

Administrative provisions (e.g., definitions, reporting requirements, or verification processes to ensure proper use of exemptions).

Sunset or applicability dates (e.g., temporary exemptions with sunset provisions, or retroactive vs. prospective applicability).

Who/what would be affected

Consumers: those who purchase goods or services that fall under the revised exclusions.

Businesses: vendors and retailers that collect sales tax and manage exempt sales, as well as sectors that could gain from expanded exemptions.

Public sector and nonprofits: entities that may qualify for exemptions or specific administrative relief.

Tax administration: state and local tax authorities responsible for implementing and enforcing the revised exclusions.

Procedural and timeline aspects

The bill would typically advance through committee hearings, amendments, and floor votes in the Pennsylvania General Assembly before potential enactment.

If enacted, the exclusions would take effect on a specified effective date (often a future date or upon enactment), with possible transitional language for ongoing sales.

Implementation may require regulatory guidance or updates to Pennsylvania Department of Revenue administrative materials and tax forms.

Potential impacts to consider

Revenue impact: broadening exclusions could reduce state sales tax collections; narrowing them could have opposite effects.

Economic impact: targeted exemptions may stimulate consumer activity or support specific industries or activities.

Administrative impact: changes may affect how retailers track exemptions, issue exemption certificates, and audit compliance.

Equity considerations: assess whether exclusions disproportionately benefit certain groups or sectors.

Bill