Pennsylvania Sales Tax Law

As with other states, Pennsylvania charges a sales tax on the majority of purchases made within state borders. According to the state Department of Revenue, this sales tax applies to "the retail sale, consumption, rental or use of tangible personal property," as well as certain services and business-service charges. It is the duty of the seller to collect the tax, report it to the government and submit the tax monies collected to the state.

Tax Rate

Pennsylvania charges a 6 percent sales tax rate as of 2012. This rate is applicable to the full purchase price, without coupons or deductions. In addition, the city of Philadelphia charges an additional 2 percent local sales tax, for a total of 8 percent. Allegheny County, home to the city of Pittsburgh, charges an additional 1 percent local tax, for a total of 7 percent.

Exemptions

Many goods and services are exempt from sales tax in Pennsylvania. Notable items include grocery store food purchases, clothing except for formal and sportswear, and pharmaceuticals and other medical supplies. Heating fuels such as coal (mined extensively in the northern part of the state), oil, and gas are also not subject to Pennsylvania sales tax.

Related Taxes

Pennsylvania charges two related taxes at the same rate as sales tax: a use tax on purchases made out of state that will be used in-state; and a hotel occupancy tax for room rentals of less than 30 days. The use tax most notably applies on purchases made via mail order from out of state, or via the Internet from out of state.

Historical Rates

Pennsylvania instituted the 6 percent tax rate in 1968. That represented the fifth increase in the rate since the state began charging a sales tax in 1954, at a rate of 1 percent. Pennsylvania sales tax was raised to 3 percent in 1956; then 3.5 percent and again to 4 percent in 1959; and 5 percent in 1963.