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HB 2523

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 12 co-sponsors

The bill would modify Pennsylvania sales and use tax exclusions, changing which goods and services are tax-free.

Referred to Finance
0
WeVote Research Nonpartisan
Bill Summary · HB 2523

Overview

HB 2523 (2025-2026) from Pennsylvania would amend the Tax Reform Code of 1971, specifically in the sales and use tax provisions, to modify exclusions from tax. The bill has a slate of co-sponsors listed, indicating bipartisan sponsorship in the House.

Purpose and intent

  • The bill aims to adjust which transactions, goods, or services are excluded from Pennsylvania sales and use tax. Exclusions determine what is not taxed, thereby shaping tax revenue, consumer prices, and business compliance.
  • By updating exclusions, the Legislature seeks to refine the tax structure to reflect policy goals (e.g., targeted exemptions for specific industries, essential goods, or consumer categories) and to respond to changing economic conditions or budget needs.

Key provisions (as described)

  • Amendments to the act of March 4, 1971 (Tax Reform Code of 1971) in the sales and use tax chapter.
  • Introduction or modification of exclusions from tax. The exact items or categories affected are not specified in the summary provided, but the bill would add, remove, or redefine exclusions from the tax base.
  • Likely alignment with broader Pennsylvania tax policy goals, such as exempting certain essential goods, promoting economic activity, or supporting particular sectors or demographics.

Who/what is affected

  • Taxpayers subject to Pennsylvania sales and use tax, including individuals and businesses purchasing taxable goods and services.
  • Vendors and businesses required to collect and remit sales tax, who would need to adjust systems to reflect new exclusions.
  • Specific sectors or categories may be impacted depending on the final text of the exclusions (for example, items like food, clothing, medical devices, certain equipment, or services), but the exact targets are not listed in the summary.

Procedural and timeline considerations

  • The bill is introduced in the House with multiple co-sponsors, signaling formal drafting and consideration within the legislative process.
  • If enacted, the changes would go into effect as specified in the bill, which may include a future effective date (e.g., a specific date or upon publication) or immediate effect upon enactment.
  • Implementation would require guidance from the Pennsylvania Department of Revenue and potential updates to tax forms, filing software, and educational resources for taxpayers and retailers.

Potential impacts to monitor

  • Revenue effect: Exclusions reduce the tax base and could lower state revenue unless offset by other measures or adjusted rates.
  • Consumer prices: Exclusions can reduce prices for goods/services, depending on who bears the tax burden in practice.
  • Compliance costs: Businesses may incur costs to update point-of-sale systems, accounting software, and training to reflect new exclusions.
  • Economic impact: Certain exclusions might promote affordability, investment, or activity in targeted sectors.

Note

  • The specific items or categories affected by the exclusions are not provided in the summary. For a complete understanding, the bill text should be reviewed to identify exact exclusions, effective dates, any sunset provisions, and any transitional rules.

Compiled from official sources — confirm details with the bill’s official record.

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