Regular Session 2021-2022 House Bill 0307 P.N. 0276

PRINTER'S NO. 276

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

307

Session of

2021

INTRODUCED BY DIAMOND, ROWE AND ZIMMERMAN, JANUARY 27, 2021

REFERRED TO COMMITTEE ON FINANCE, JANUARY 27, 2021

AN ACT

Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An

act relating to tax reform and State taxation by codifying

and enumerating certain subjects of taxation and imposing

taxes thereon; providing procedures for the payment,

collection, administration and enforcement thereof; providing

for tax credits in certain cases; conferring powers and

imposing duties upon the Department of Revenue, certain

employers, fiduciaries, individuals, persons, corporations

and other entities; prescribing crimes, offenses and

penalties," in sales and use tax, further providing for

definitions, for imposition of tax and for computation of

tax, repealing provisions relating to exclusions from tax and

further providing for alternate imposition of tax and credits

and for transfers to Public Transportation Assistance Fund;

and, in special taxing authority, further providing for

special taxing authority.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Sections 201(a), (b)(4), (c)(5) and last clause,

(d)(13), (f)(3) and last clause, (g)(1), (i)(4), (k)(4), (8) and

(10), (o)(4), (6) and (8), (p), (t)(2) and (3), (x), (y), (z),

(aa), (bb), (cc), (kk), (ll)(3), (nn), (pp)(10), (rr), (yy) and

(ccc) and 202 of the act of March 4, 1971 (P.L.6, No.2), known

as the Tax Reform Code of 1971, amended June 28, 2019 (P.L.50,

No.13), are amended to read:

Section 201. Definitions.--The following words, terms and

phrases when used in this Article II shall have the meaning

ascribed to them in this section, except where the context

clearly indicates a different meaning:

(a) "Soft drinks." All nonalcoholic beverages, whether

carbonated or not, such as soda water, ginger ale, coca cola,

lime cola, pepsi cola, Dr. Pepper, fruit juice when plain or

carbonated water, flavoring or syrup is added, carbonated water,

orangeade, lemonade, root beer or any and all preparations,

commonly referred to as "soft drinks," of whatsoever kind, and

are further described as including any and all beverages,

commonly referred to as "soft drinks," which are made with or

without the use of any syrup. [The term "soft drinks" shall not

include natural fruit or vegetable juices or their concentrates,

or non-carbonated fruit juice drinks containing not less than

twenty-five per cent by volume of natural fruit juices or of

fruit juice which has been reconstituted to its original state,

or natural concentrated fruit or vegetable juices reconstituted

to their original state, whether any of the foregoing natural

juices are frozen or unfrozen, sweetened or unsweetened,

seasoned with salt or spice or unseasoned, nor shall the term

"soft drinks" include coffee, coffee substitutes, tea, cocoa,

natural fluid milk or non-carbonated drinks made from milk

derivatives.]

(b) "Maintaining a place of business in this Commonwealth."

* * *

[(4) The term "maintaining a place of business in this

Commonwealth" shall not include:

(i) Owning or leasing of tangible or intangible property by

a person who has contracted with an unaffiliated commercial

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printer for printing, provided that:

(A) the property is for use by the commercial printer; and

(B) the property is located at the Pennsylvania premises of

the commercial printer.

(ii) Visits by a person's employes or agents to the premises

in this Commonwealth of an unaffiliated commercial printer with

whom the person has contracted for printing in connection with

said contract.]

fabricating, compounding, processing or other operations,

engaged in as a business, which place any tangible personal

property in a form, composition or character different from that

in which it is acquired whether for sale or use by the

manufacturer, and shall include, but not be limited to--

* * *

(5) Research having as its objective the production of a new

or an improved (i) product or utility service, or (ii) method of

producing a product or utility service[, but in either case not

including market research or research having as its objective

the improvement of administrative efficiency].

* * *

[The term "manufacture" shall not include constructing,

altering, servicing, repairing or improving real estate or

repairing, servicing or installing tangible personal property,

nor the producing of a commercial motion picture, nor the

cooking, freezing or baking of fruits, vegetables, mushrooms,

fish, seafood, meats, poultry or bakery products.]

* * *

(d) "Processing." The performance of the following

activities when engaged in as a business enterprise:

20210HB0307PN0276 - 3 -

* * *

(13) The cooking or baking of bread, pastries, cakes,

cookies, muffins and donuts when the person engaged in such

activity sells such items at retail at locations that do not

constitute an establishment from which ready-to-eat food and

beverages are sold. [For purposes of this clause, a bakery, a

pastry shop and a donut shop shall not be considered an

establishment from which ready-to-eat food and beverages are

sold.]

* * *

(f) "Purchase at retail."

* * *

(3) The obtaining for a consideration of those services

described in subclauses (2), (3) and (4) of clause (k) of this

section [other than for resale].

* * *

The term "purchase at retail" with respect to "liquor" and

"malt or brewed beverages" shall include the purchase of

"liquor" from any "Pennsylvania Liquor Store" by any person for

any purpose, and the purchase of "malt or brewed beverages" from

a "manufacturer of malt or brewed beverages," "distributor" or

"importing distributor" by any person for any purpose, except

purchases from a "manufacturer of malt or brewed beverages" by a

"distributor" or "importing distributor" or purchases from an

"importing distributor" by a "distributor" within the meaning of

the "Liquor Code." The term ["purchase at retail" shall not

include any purchase of "malt or brewed beverages" from a

"retail dispenser" or any purchase of "liquor" or "malt or

brewed beverages" from a person holding a "retail liquor

license" within the meaning of and pursuant to the provisions of

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the "Liquor Code," but] shall include any purchase or

acquisition of "liquor" or "malt or brewed beverages" other than

pursuant to the provisions of the "Liquor Code."

(g) "Purchase price."

(1) The total value of anything paid or delivered, or

promised to be paid or delivered, whether it be money or

otherwise, in complete performance of a sale at retail or

purchase at retail, as herein defined, without any deduction on

account of the cost or value of the property sold, cost or value

of transportation, cost or value of labor or service, interest

or discount paid or allowed after the sale is consummated, any

other taxes imposed by the Commonwealth of Pennsylvania or any

other expense [except that there shall be excluded any gratuity

or separately stated deposit charge for returnable containers].

* * *

(i) "Resale."

* * *

[(4) The term "resale" shall not include any sale of "malt

or brewed beverages" by a "retail dispenser," or any sale of

"liquor" or "malt or brewed beverages" by a person holding a

"retail liquor license" within the meaning of the "Liquor

Code."]

* * *

(k) "Sale at retail."

* * *

(4) The rendition for a consideration of the service of

repairing, altering, mending, pressing, fitting, dyeing,

laundering, drycleaning or cleaning tangible personal property

other than wearing apparel or shoes, or applying or installing

tangible personal property as a repair or replacement part of

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other tangible personal property except wearing apparel or shoes

for a consideration, whether or not the services are performed

directly or by any means other than by coin-operated self-

service laundry equipment for wearing apparel or household goods

and whether or not any tangible personal property is transferred

in conjunction therewith[, except such services as are rendered

in the construction, reconstruction, remodeling, repair or

maintenance of real estate: Provided, however, That this

subclause shall not be deemed to impose tax upon such services

in the preparation for sale of new items which are excluded from

the tax under clause (26) of section 204, or upon diaper

service].

(8) Any retention of possession, custody or a license to use

or consume tangible personal property or any further obtaining

of services described in subclauses (2), (3) and (4) of this

clause pursuant to a rental or service contract or other

arrangement (other than as security).

[The term "sale at retail" shall not include (i) any such

transfer of tangible personal property or rendition of services

for the purpose of resale, or (ii) such rendition of services or

the transfer of tangible personal property including, but not

limited to, machinery and equipment and parts therefor and

supplies to be used or consumed by the purchaser directly in the

operations of--

(A) The manufacture of tangible personal property.

(B) Farming, dairying, agriculture, timbering, horticulture

or floriculture when engaged in as a business enterprise. The

term "farming" shall include the propagation and raising of

ranch raised fur-bearing animals and the propagation of game

birds for commercial purposes by holders of propagation permits

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issued under 34 Pa.C.S. (relating to game) and the propagation

and raising of horses to be used exclusively for commercial

racing activities. The term "timbering" shall include:

(1) The business of producing or harvesting trees from

forests, woodlots or tree farms for the purpose of the

commercial production of wood, paper or energy products derived

from wood by a company primarily engaged in the business of

harvesting trees.

(2) All operations prior to the transport of the harvested

product necessary for the removal of timber or forest products

from the site, in-field processing of trees into logs or chips,

complying with environmental protection and safety requirements

applicable to the harvesting of forest products, loading of

forest products onto highway vehicles for transport to storage

or processing facilities and postharvesting site reclamation,

including those activities necessary to improve timber growth or

ensure natural or direct reforestation of the site. The term

shall not include the harvesting of trees for clearing land for

access roads.

utility service, or in constructing, reconstructing, remodeling,

repairing or maintaining the facilities which are directly used

in producing, delivering or rendering such service.

(D) Processing as defined in clause (d) of this section.

The exclusions provided in paragraphs (A), (B), (C) and (D)

shall not apply to any vehicle required to be registered under

The Vehicle Code, except those vehicles used directly by a

public utility engaged in business as a common carrier; to

maintenance facilities; or to materials, supplies or equipment

to be used or consumed in the construction, reconstruction,

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remodeling, repair or maintenance of real estate other than

directly used machinery, equipment, parts or foundations

therefor that may be affixed to such real estate.

The exclusions provided in paragraphs (A), (B), (C) and (D)

shall not apply to tangible personal property or services to be

used or consumed in managerial sales or other nonoperational

activities, nor to the purchase or use of tangible personal

property or services by any person other than the person

directly using the same in the operations described in

paragraphs (A), (B), (C) and (D) herein.

The exclusion provided in paragraph (C) shall not apply to

(i) construction materials, supplies or equipment used to

construct, reconstruct, remodel, repair or maintain facilities

not used directly by the purchaser in the production, delivering

or rendition of public utility service, (ii) construction

materials, supplies or equipment used to construct, reconstruct,

remodel, repair or maintain a building, road or similar

structure, or (iii) tools and equipment used but not installed

in the maintenance of facilities used directly in the

production, delivering or rendition of a public utility service.

The exclusions provided in paragraphs (A), (B), (C) and (D)

shall not apply to the services enumerated in clauses (k)(11)

through (18) and (w) through (kk), except that the exclusion

provided in this subclause for farming, dairying and agriculture

shall apply to the service enumerated in clause (z).]

* * *

(10) The term "sale at retail" with respect to "liquor" and

"malt or brewed beverages" shall include the sale of "liquor" by

any "Pennsylvania liquor store" to any person for any purpose,

and the sale of "malt or brewed beverages" by a "manufacturer of

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malt or brewed beverages," "distributor" or "importing

distributor" to any person for any purpose, except sales by a

"manufacturer of malt or brewed beverages" to a "distributor" or

"importing distributor" or sales by an "importing distributor"

to a "distributor" within the meaning of the "Liquor Code." [The

term "sale at retail" shall not include any sale of "malt or

brewed beverages" by a "retail dispenser" or any sale of

"liquor" or "malt or brewed beverages" by a person holding a

"retail liquor license" within the meaning of and pursuant to

the provisions of the "Liquor Code," but shall include any sale

of "liquor" or "malt or brewed beverages" other than pursuant to

the provisions of the "Liquor Code."]

* * *

(o) "Use."

* * *

(4) The obtaining by a purchaser of the service of

repairing, altering, mending, pressing, fitting, dyeing,

laundering, drycleaning or cleaning tangible personal property

other than wearing apparel or shoes or applying or installing

tangible personal property as a repair or replacement part of

other tangible personal property other than wearing apparel or

shoes, whether or not the services are performed directly or by

any means other than by means of coin-operated self-service

laundry equipment for wearing apparel or household goods, and

whether or not any tangible personal property is transferred to

the purchaser in conjunction therewith, except such services as

are obtained in the construction, reconstruction, remodeling,

repair or maintenance of real estate.[: Provided, however, That

this subclause shall not be deemed to impose tax upon such

services in the preparation for sale of new items which are

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excluded from the tax under clause (26) of section 204, or upon

diaper service: And provided further, That the term "use" shall

not include--

(A) Any tangible personal property acquired and kept,

retained or over which power is exercised within this

Commonwealth on which the taxing of the storage, use or other

consumption thereof is expressly prohibited by the Constitution

of the United States or which is excluded from tax under other

provisions of this article.

(B) The use or consumption of tangible personal property,

including but not limited to machinery and equipment and parts

therefor, and supplies or the obtaining of the services

described in subclauses (2), (3) and (4) of this clause directly

in the operations of--

(i) The manufacture of tangible personal property.

(ii) Farming, dairying, agriculture, timbering, horticulture

or floriculture when engaged in as a business enterprise. The

term "farming" shall include the propagation and raising of

ranch-raised furbearing animals and the propagation of game

birds for commercial purposes by holders of propagation permits

issued under 34 Pa.C.S. (relating to game) and the propagation

and raising of horses to be used exclusively for commercial

racing activities. The term "timbering" shall include:

(1) The business of producing or harvesting trees from

forests, woodlots or tree farms for the purpose of the

commercial production of wood, paper or energy products derived

from wood by a company primarily engaged in the business of

harvesting trees.

(2) All operations prior to the transport of the harvested

product necessary for the removal of timber or forest products

20210HB0307PN0276 - 10 -

from the site, in-field processing of trees into logs or chips,

complying with environmental protection and safety requirements

applicable to the harvesting of forest products, loading of

forest products onto highway vehicles for transport to storage

or processing facilities and postharvesting site reclamation,

including those activities necessary to improve timber growth or

ensure natural or direct reforestation of the site. The term

shall not include the harvesting of trees for clearing land for

access roads.

(iii) The producing, delivering or rendering of a public

utility service, or in constructing, reconstructing, remodeling,

repairing or maintaining the facilities which are directly used

in producing, delivering or rendering such service.

(iv) Processing as defined in subclause (d) of this section.

The exclusions provided in subparagraphs (i), (ii), (iii) and

(iv) shall not apply to any vehicle required to be registered

under The Vehicle Code except those vehicles directly used by a

public utility engaged in the business as a common carrier; to

maintenance facilities; or to materials, supplies or equipment

to be used or consumed in the construction, reconstruction,

remodeling, repair or maintenance of real estate other than

directly used machinery, equipment, parts or foundations

therefor that may be affixed to such real estate. The exclusions

provided in subparagraphs (i), (ii), (iii) and (iv) shall not

apply to tangible personal property or services to be used or

consumed in managerial sales or other nonoperational activities,

nor to the purchase or use of tangible personal property or

services by any person other than the person directly using the

same in the operations described in subparagraphs (i), (ii),

(iii) and (iv).

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The exclusion provided in subparagraph (iii) shall not apply

to (A) construction materials, supplies or equipment used to

construct, reconstruct, remodel, repair or maintain facilities

not used directly by the purchaser in the production, delivering

or rendition of public utility service or (B) tools and

equipment used but not installed in the maintenance of

facilities used directly in the production, delivering or

rendition of a public utility service.

The exclusion provided in subparagraphs (i), (ii), (iii) and

(iv) shall not apply to the services enumerated in clauses (o)

(9) through (16) and (w) through (kk), except that the exclusion

provided in subparagraph (ii) for farming, dairying and

agriculture shall apply to the service enumerated in clause

(z).]

* * *

(6) The term "use" with respect to "liquor" and "malt or

brewed beverages" shall include the purchase of "liquor" from

any "Pennsylvania liquor store" by any person for any purpose

and the purchase of "malt or brewed beverages" from a

"manufacturer of malt or brewed beverages," "distributor" or

"importing distributor" by any person for any purpose, [except

purchases from a "manufacturer of malt or brewed beverages" by a

"distributor" or "importing distributor," or purchases from an

"importing distributor" by a "distributor" within the meaning of

the "Liquor Code." The term "use" shall not include any purchase

of "malt or brewed beverages" from a "retail dispenser" or any

purchase of "liquor" or "malt or brewed beverages" from a person

holding a "retail liquor license" within the meaning of and

pursuant to the provisions of the "Liquor Code,"] but shall

include the exercise of any right or power incidental to the

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ownership, custody or possession of "liquor" or "malt or brewed

beverages" obtained by the person exercising such right or power

in any manner other than pursuant to the provisions of the

"Liquor Code."

* * *

[(8) The term "use" shall not include the providing of a

motor vehicle to a nonprofit private or public school to be used

by such a school for the sole purpose of driver education.]

* * *

(p) "Vendor." Any person maintaining a place of business in

this Commonwealth, selling or leasing tangible personal

property, or rendering services, the sale or use of which is

subject to the tax imposed by this article, including a

marketplace facilitator and a marketplace seller[, but not

including any employe who in the ordinary scope of employment

renders services to his employer in exchange for wages and

salaries].

* * *

(t) "Transient vendor."

* * *

[(2) The term shall not include a person who delivers

tangible personal property within the Commonwealth pursuant to

orders for such property which were solicited or placed by mail

or other means.

(3) The term shall not include a person who handcrafts items

for sale at special events, including, but not limited to,

fairs, carnivals, art and craft shows and other festivals and

celebrations within this Commonwealth.]

* * *

(x) "Adjustment services, collection services or credit

20210HB0307PN0276 - 13 -

reporting services." Providing collection or adjustments of

accounts receivable or mercantile or consumer credit reporting,

including, but not limited to, services of the type provided by

adjustment bureaus or collection agencies, consumer or

mercantile credit reporting bureaus, credit bureaus or agencies,

credit clearinghouses or credit investigation services. [Such

services do not include providing credit card service with

collection by a central agency, providing debt counseling or

adjustment services to individuals or billing or collection

services provided by local exchange telephone companies.]

(y) "Secretarial or editing services." Providing services

which include, but are not limited to, editing, letter writing,

proofreading, resume writing, typing or word processing. [Such

services shall not include court reporting and stenographic

services.]

(z) "Disinfecting or pest control services." Providing

disinfecting, termite control, insect control, rodent control or

other pest control services. Such services include, but are not

limited to, deodorant servicing of rest rooms, washroom

sanitation service, rest room cleaning service, extermination

service or fumigating service. [As used in this clause, the term

"fumigating service" shall not include the fumigation of

agricultural commodities or containers used for agricultural

commodities. As used in this clause, the term "insect control"

shall not include the spraying of trees which are harvested for

commercial purposes for gypsy moth control.]

(aa) "Building maintenance or cleaning services." Providing

services which include, but are not limited to, janitorial, maid

or housekeeping service, office or interior building cleaning or

maintenance service, window cleaning service, floor waxing

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service, lighting maintenance service such as bulb replacement,

cleaning, chimney cleaning service, acoustical tile cleaning

service, venetian blind cleaning, cleaning and maintenance of

telephone booths or cleaning and degreasing of service stations.

[This term shall not include repairs on buildings and other

structures; nor shall this term include the maintenance or

repair of boilers, furnaces and residential air conditioning

equipment or parts thereof; the painting, wallpapering or

applying other like coverings to interior walls, ceilings or

floors; or the exterior painting of buildings.]

(bb) "Employment agency services." Providing employment

services to a prospective employer or employe [other than

employment services provided by theatrical employment agencies

and motion picture casting bureaus]. Such services shall

include, but are not limited to, services of the type provided

by employment agencies, executive placing services and labor

contractor employment agencies other than farm labor.

(cc) "Help supply services." Providing temporary or

continuing help where the help supplied is on the payroll of the

supplying person or entity, but is under the supervision of the

individual or business to which help is furnished. Such services

include, but are not limited to, service of a type provided by

labor and manpower pools, employe leasing services, office help

supply services, temporary help services, usher services,

modeling services or fashion show model supply services. [Such

services shall not include providing farm labor services. The

term shall not include human health-related services, including

nursing, home health care and personal care.] As used in this

clause, "personal care" shall include providing at least one of

the following types of assistance to persons with limited

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ability for self-care:

(1) dressing, bathing or feeding;

(2) supervising self-administered medication;

(3) transferring a person to or from a bed or wheelchair; or

(4) routine housekeeping chores when provided in conjunction

with and supplied by the same provider of the assistance listed

in subclause (1), (2) or (3).

* * *

(kk) "Self-storage service." Providing a building, a room

in a building or a secured area within a building with separate

access provided for each purchaser of self-storage service,

primarily for the purpose of storing personal property. [The

term excludes providing:

(1) safe deposit boxes by financial institutions;

(2) storage in refrigerator or freezer units;

(3) storage in commercial warehouses;

(4) facilities for goods distribution; and

(5) lockers in airports, bus stations, museums and other

public places.]

(ll) "Premium cable or premium video programming service."

That portion of cable television services, video programming

services, community antenna television services or any other

distribution of television, video, audio or radio services which

meets all of the following criteria:

* * *

(3) does not constitute a component of a basic service tier

provided by a cable television system or a cable programming

service tier provided by a cable television system. A basic

service tier shall include all signals of domestic television

broadcast stations, any public, educational, governmental or

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religious programming and any additional video programming

signals or service added to the basic service tier by the cable

operator. The basic service tier shall also include a single

additional lower-priced package of broadcast channels and access

information channels which is a subset of the basic service tier

as set forth above. A cable programming service tier includes

any video programming other than: (i) the basic service tier;

(ii) video programming offered on a pay-per-channel or pay-per-

view basis; or (iii) a combination of multiple channels of pay-

per-channel or pay-per-view programming offered as a package.

If a purchaser receives or agrees to receive premium cable or

premium video programming service, then the following charges

are included in the purchase price: charges for installation or

repair of any premium cable or premium video programming

service, upgrade to include additional premium cable or premium

video programming service, downgrade to exclude all or some

premium cable or premium video programming service, additional

premium cable outlets in excess of ten or any other charge or

fee related to premium cable or premium video programming

services. [The term shall not apply to transmissions by public

television, public radio services or official Federal, State or

local government cable services. Nor shall the term apply to

local origination programming which provides a variety of public

service programs unique to the community, programming which

provides coverage of public affairs issues which are presented

without commentary or analysis, including United States

Congressional proceedings, or programming which is substantially

related to religious subjects. Nor shall the term "premium cable

or premium video programming service" apply to subscriber

charges for access to a video dial tone system or charges by a

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common carrier to a video programmer for the transport of video

programming.]

* * *

(nn) "Construction contract." A written or oral contract or

agreement for the construction, reconstruction, remodeling,

renovation or repair of real estate or a real estate structure.

[The term shall not apply to services which are taxable under

clauses (k)(14) and (17) and (o)(12) and (15).]

* * *

(pp) "Building machinery and equipment." Generation

equipment, storage equipment, conditioning equipment,

distribution equipment and termination equipment, which shall be

limited to the following:

* * *

(10) furniture, cabinetry and kitchen equipment.

The term shall include boilers, chillers, air cleaners,

humidifiers, fans, switchgear, pumps, telephones, speakers,

horns, motion detectors, dampers, actuators, grills, registers,

traffic signals, sensors, card access devices, guardrails,

medial devices, floor troughs and grates and laundry equipment,

together with integral coverings and enclosures, whether or not

the item constitutes a fixture or is otherwise affixed to the

real estate, whether or not damage would be done to the item or

its surroundings upon removal or whether or not the item is

physically located within a real estate structure. [The term

"building machinery and equipment" shall not include guardrail

posts, pipes, fittings, pipe supports and hangers, valves,

underground tanks, wire, conduit, receptacle and junction boxes,

insulation, ductwork and coverings thereof.]

* * *

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(rr) "Telecommunications service." Any one-way transmission

or any two-way, interactive transmission of sounds, signals or

other intelligence converted to like form which effects or is

intended to effect meaningful communications by electronic or

electromagnetic means via wire, cable, satellite, light waves,

microwaves, radio waves or other transmission media. The term

includes all types of telecommunication transmissions, such as

local, toll, wide-area or any other type of telephone service;

private line service; telegraph service; radio repeater service;

wireless communication service; personal communications system

service; cellular telecommunication service; specialized mobile

radio service; stationary two-way radio service; and paging

service. [The term does not include any of the following:

(1) Subscriber charges for access to a video dial tone

system.

(2) Charges to video programmers for the transport of video

programming.

(3) Charges for access to the Internet. Access to the

Internet does not include any of the following:

(A) The transport over the Internet or any proprietary

network using the Internet protocol of telephone calls,

facsimile transmissions or other telecommunications traffic to

or from end users on the public switched telephone network if

the signal sent from or received by an end user is not in an

Internet protocol.

(B) Telecommunication services purchased by an Internet

service provider to deliver access to the Internet to its

customers.

(4) Mobile telecommunications services.]

* * *

20210HB0307PN0276 - 19 -

(yy) "Prebuilt housing sale." A sale of prebuilt housing to

a prebuilt housing purchaser, including a sale to a landlord,

without regard to whether the person making the sale is

responsible for installing the prebuilt housing or whether the

prebuilt housing becomes a real estate structure upon

installation. [Temporary installation by a prebuilt housing

builder for display purposes of a unit held for resale shall not

be considered occupancy for residential purposes.]

* * *

(ccc) "Prepaid mobile telecommunications service." Mobile

telecommunications service which is paid for in advance and

which enables the origination of calls using an access number,

authorization code or both, whether manually or electronically

dialed, if the remaining amount of units of the prepaid mobile

telecommunications service is known by the service provider of

the prepaid mobile telecommunications service on a continuous

basis. [The term does not include the advance purchase of mobile

telecommunications service if the purchase is pursuant to a

service contract between the service provider and customer and

if the service contract requires the customer to make periodic

payments to maintain the mobile telecommunications service.]

* * *

Section 202. Imposition of Tax.--(a) There is hereby

imposed upon each separate sale at retail of tangible personal

property or services, as defined herein, within this

Commonwealth a tax of [six] one and nine-tenths per cent of the

purchase price, which tax shall, except as otherwise provided,

be collected by the vendor or any other person required by this

article from the purchaser, and shall be paid over to the

Commonwealth as herein provided.

20210HB0307PN0276 - 20 -

(b) There is hereby imposed upon the use, on and after the

effective date of this article, within this Commonwealth of

tangible personal property purchased at retail on or after the

effective date of this article, and on those services described

herein purchased at retail on and after the effective date of

this article, a tax of [six] one and nine-tenths per cent of the

purchase price, which tax shall be paid to the Commonwealth by

the person who makes such use as herein provided, except that

such tax shall not be paid to the Commonwealth by such person

where he has paid the tax imposed by subsection (a) of this

section or has paid the tax imposed by this subsection (b) to

the vendor with respect to such use, or such vendor advertises

or holds out or states to such person directly or indirectly

subject to the conditions set forth in section 268(b) that such

vendor will pay the tax imposed by subsection (a) or this

subsection for such person. The tax at the rate of [six] one and

nine-tenths per cent imposed by this subsection shall not be

deemed applicable where the tax has been incurred under the

provisions of the "Tax Act of 1963 for Education."

the tax with respect to telecommunications service within the

meaning of clause (m) of section 201 of this article shall,

except for telegrams paid for in cash at telegraph offices, be

computed at the rate of [six] one and nine-tenths per cent upon

the total amount charged to customers for such services,

irrespective of whether such charge is based upon a flat rate or

upon a message unit charge[, but in no event shall charges for

telephone calls paid for by inserting money into a telephone

accepting direct deposits of money to operate be subject to this

tax]. A telecommunications service provider shall have no

20210HB0307PN0276 - 21 -

responsibility or liability to the Commonwealth for billing,

collecting or remitting taxes that apply to services, products

or other commerce sold over telecommunications lines by third-

party vendors. To prevent actual multistate taxation of

interstate telecommunications service, any taxpayer, upon proof

that the taxpayer has paid a similar tax to another state on the

same interstate telecommunications service, shall be allowed a

credit against the tax imposed by this section on the same

interstate telecommunications service to the extent of the

amount of such tax properly due and paid to such other state.

(d) Notwithstanding any other provisions of this article,

the sale or use of food and beverages dispensed by means of coin

operated vending machines shall be taxed at the rate of [six]

one and nine tenths per cent of the receipts collected from any

such machine which dispenses food and beverages heretofore

taxable.

(e) (1) Notwithstanding any provisions of this article, the

sale or use of prepaid telecommunications evidenced by the

transfer of tangible personal property shall be subject to the

tax imposed by subsections (a) and (b).

(2) The sale or use of prepaid telecommunications not

evidenced by the transfer of tangible personal property shall be

subject to the tax imposed by subsections (a) and (b) and shall

be deemed to occur at the purchaser's billing address.

(3) Notwithstanding clause (2), the sale or use of prepaid

telecommunications service not evidenced by the transfer of

tangible personal property shall be taxed at the rate of [six]

one and nine tenths per cent of the receipts collected on each

sale if the service provider elects to collect the tax imposed

by this article on receipts of each sale. The service provider

20210HB0307PN0276 - 22 -

shall notify the department of its election and shall collect

the tax on receipts of each sale until the service provider

notifies the department otherwise.

(e.1) (1) Notwithstanding any other provision of this

article, the sale or use of prepaid mobile telecommunications

service evidenced by the transfer of tangible personal property

shall be subject to the tax imposed by subsections (a) and (b).

(2) The sale or use of prepaid mobile telecommunications

service not evidenced by the transfer of tangible personal

property shall be subject to the tax imposed by subsections (a)

and (b) and shall be deemed to occur at the purchaser's billing

address or the location associated with the mobile telephone

number or the point of sale, whichever is applicable.

(3) Notwithstanding clause (2), the sale or use of prepaid

mobile telecommunications service not evidenced by the transfer

of tangible personal property shall be taxed at the rate of

[six] one and nine-tenths per cent of the receipts collected on

each sale if the service provider elects to collect the tax

imposed by this article on receipts of each sale. The service

provider shall notify the department of its election and shall

collect the tax on receipts of each sale until the service

provider notifies the department otherwise.

(f) Notwithstanding any other provision of this article, tax

with respect to sales of prebuilt housing shall be imposed on

the prebuilt housing builder at the time of the prebuilt housing

sale within this Commonwealth and shall be paid and reported by

the prebuilt housing builder to the department in the time and

manner provided in this article: Provided, however, That a

manufacturer of prebuilt housing may, at its option, precollect

the tax from the prebuilt housing builder at the time of sale to

20210HB0307PN0276 - 23 -

the prebuilt housing builder. In any case where prebuilt housing

is purchased and the tax is not paid by the prebuilt housing

builder or precollected by the manufacturer, the prebuilt

housing purchaser shall remit tax directly to the department if

the prebuilt housing is used in this Commonwealth without regard

to whether the prebuilt housing becomes a real estate structure.

(g) Notwithstanding any other provisions of this article and

in accordance with the Mobile Telecommunications Sourcing Act (4

U.S.C. § 116), the sale or use of mobile telecommunications

services which are deemed to be provided to a customer by a home

service provider under section 117(a) and (b) of the Mobile

Telecommunications Sourcing Act shall be subject to the tax of

[six] one and nine-tenths per cent of the purchase price, which

tax shall be collected by the home service provider from the

customer, and shall be paid over to the Commonwealth as herein

provided if the customer's place of primary use is located

within this Commonwealth, regardless of where the mobile

telecommunications services originate, terminate or pass

through. For purposes of this subsection, words and phrases used

in this subsection shall have the same meanings given to them in

the Mobile Telecommunications Sourcing Act.

(h) (1) Notwithstanding any other provision of this

article, Article II-B, the act of July 28, 1953 (P.L.723,

No.230), known as the Second Class County Code, or Chapter 5 or

6 of the act of June 5, 1991 (P.L.9, No.6), known as the

Pennsylvania Intergovernmental Cooperation Authority Act for

Cities of the First Class, the tax shall be imposed on a

manufacturer of malt or brewed beverages with respect to sales

of malt or brewed beverages sold by the manufacturer directly to

the ultimate consumer for consumption on or off premises.

20210HB0307PN0276 - 24 -

(2) The tax imposed under clause (1) shall be paid and

reported by the manufacturer of malt or brewed beverages to the

department in the time and manner provided in this article.

(3) Notwithstanding any law to the contrary, a school

district or local government authorized to impose a local

alcoholic beverage tax under the act of June 10, 1971 (P.L.153,

No.7), known as the First Class School District Liquor Sales Tax

Act of 1971, or 53 Pa.C.S. § 8602 (relating to local financial

support), may impose or continue to impose a local alcoholic

beverage tax on the sale at retail of malt or brewed beverages

made by a manufacturer of malt or brewed beverages to the

ultimate consumer for consumption on or off premises at the same

rate as authorized under the First Class School District Liquor

Sales Tax Act of 1971 or 53 Pa.C.S. § 8602 and notwithstanding

anything to the contrary in such laws or in a local law or

ordinance in existence on the effective date of this section.

(4) The payment of the tax imposed under clause (1) shall

eliminate the need for the ultimate consumer to pay or remit a

sales or use tax on the related transaction or upon the

subsequent use of the malt or brewed beverages.

Section 2. Section 203 of the act is amended to read:

Section 203. Computation of Tax.--The amount of tax imposed

by section 202 of this article shall be computed [as follows:

(a) If the purchase price is ten cents (10¢) or less, no tax

shall be collected.

(b) If the purchase price is eleven cents (11¢) or more but

less than eighteen cents (18¢), one cent (1¢) shall be

collected.

but less than thirty-five cents (35¢), two cents (2¢) shall be

20210HB0307PN0276 - 25 -

collected.

(d) If the purchase price is thirty-five cents (35¢) or more

but less than fifty-one cents (51¢), three cents (3¢) shall be

collected.

(e) If the purchase price is fifty-one cents (51¢) or more

but less than sixty-eight cents (68¢), four cents (4¢) shall be

collected.

(f) If the purchase price is sixty-eight cents (68¢) or more

but less than eighty-five cents (85¢), five cents (5¢) shall be

collected.

(g) If the purchase price is eighty-five cents (85¢) or more

but less than one dollar and one cent ($1.01), six cents (6¢)

shall be collected.

(h) If the purchase price is more than one dollar ($1.00),

six per centum of each dollar of purchase price plus the above

bracket charges upon any fractional part of a dollar in excess

of even dollars shall be collected.] by the department. The

department shall provide the computation to the Legislative

Reference Bureau for publication in the Pennsylvania Bulletin.

Section 3. Section 204 of the act is repealed:

[Section 204. Exclusions from Tax.--The tax imposed by

section 202 shall not be imposed upon any of the following:

(1) The sale at retail or use of tangible personal property

(other than motor vehicles, trailers, semi-trailers, motor

boats, aircraft or other similar tangible personal property

required under either Federal law or laws of this Commonwealth

to be registered or licensed) or services sold by or purchased

from a person not a vendor in an isolated transaction or sold by

or purchased from a person who is a vendor but is not a vendor

with respect to the tangible personal property or services sold

20210HB0307PN0276 - 26 -

or purchased in such transaction: Provided, That inventory and

stock in trade so sold or purchased, shall not be excluded from

the tax by the provisions of this subsection.

(2) The use of tangible personal property purchased by a

nonresident person outside of, and brought into this

Commonwealth for use therein for a period not to exceed seven

days, or for any period of time when such nonresident is a

tourist or vacationer and, in either case not consumed within

the Commonwealth.

(3) The use of tangible personal property purchased outside

this Commonwealth for use outside this Commonwealth by a then

nonresident natural person or a business entity not actually

doing business within this Commonwealth, who later brings such

tangible personal property into this Commonwealth in connection

with his establishment of a permanent business or residence in

this Commonwealth: Provided, That such property was purchased

more than six months prior to the date it was first brought into

this Commonwealth or prior to the establishment of such business

or residence, whichever first occurs. This exclusion shall not

apply to tangible personal property temporarily brought into

Pennsylvania for the performance of contracts for the

construction, reconstruction, remodeling, repairing and

maintenance of real estate.

(4) The sale at retail or use of disposable diapers; pre-

moistened wipes; incontinence products; colostomy deodorants;

toilet paper; sanitary napkins, tampons or similar items used

for feminine hygiene; or toothpaste, toothbrushes or dental

floss.

(5) The sale at retail or use of steam, natural and

manufactured and bottled gas, fuel oil, electricity or

20210HB0307PN0276 - 27 -

intrastate subscriber line charges, basic local telephone

service or telegraph service when purchased directly by the user

thereof solely for his own residential use and charges for

telephone calls paid for by inserting money into a telephone

accepting direct deposits of money to operate.

(10) The sale at retail to or use by (i) any charitable

organization, volunteer firemen's organization, volunteer

firefighters' relief association as defined in 35 Pa.C.S. § 7412

(relating to definitions) or nonprofit educational institution,

or (ii) a religious organization for religious purposes of

tangible personal property or services other than pursuant to a

construction contract: Provided, however, That the exclusion of

this clause shall not apply with respect to any tangible

personal property or services used in any unrelated trade or

business carried on by such organization or institution or with

respect to any materials, supplies and equipment used and

transferred to such organization or institution in the

construction, reconstruction, remodeling, renovation, repairs

and maintenance of any real estate structure, other than

building machinery and equipment, except materials and supplies

when purchased by such organizations or institutions for routine

maintenance and repairs. If the department has issued sales tax-

exempt status to a volunteer firefighters' organization or a

volunteer firefighters' relief association, the sales tax-exempt

status may not expire unless the activities of the organization

or association change so that the organization or association

does not qualify as an institution of purely public charity in

which case the organization or association shall immediately

notify the department of the change. If the department

ascertains that an organization or association no longer

20210HB0307PN0276 - 28 -

qualifies as an institution of purely public charity, the

department may revoke the sales tax-exempt status of the

organization or association.

(11) The sale at retail, or use of gasoline and other motor

fuels, the sales of which are otherwise subject to excise taxes

under the act of May 21, 1931 (P.L.194), known as the "Liquid

Fuels Tax Act," and the act of January 14, 1952 (P.L.1965),

known as the "Fuel Use Tax Act."

(12) The sale at retail to, or use by the United States,

this Commonwealth or its instrumentalities or political

subdivisions of tangible personal property or services.

(13) The sale at retail, or use of wrapping paper, wrapping

twine, bags, cartons, tape, rope, labels, nonreturnable

containers and all other wrapping supplies, when such use is

incidental to the delivery of any personal property, except that

any charge for wrapping or packaging shall be subject to tax at

the rate imposed by section 202, unless the property wrapped or

packaged will be resold by the purchaser of the wrapping or

packaging service. As used in this paragraph, the term "cartons"

includes corrugated boxes used by a person engaged in the

manufacture of snack food products to deliver the manufactured

product, whether or not the boxes are returnable for potential

reuse.

(14) Sale at retail or use of vessels designed for

commercial use of registered tonnage of fifty tons or more when

produced by the builders thereof upon special order of the

purchaser.

(15) Sale at retail of tangible personal property or

services used or consumed in building, rebuilding, repairing and

making additions to or replacements in and upon vessels designed

20210HB0307PN0276 - 29 -

for commercial use of registered tonnage of fifty tons or more

upon special order of the purchaser, or when rebuilt, repaired

or enlarged, or when replacements are made upon order of or for

the account of the owner.

(16) The sale at retail or use of tangible personal property

or services to be used or consumed for ship cleaning or

maintenance or as fuel, supplies, ships' equipment, ships'

stores or sea stores on vessels designed for commercial use of

registered tonnage of fifty tons or more to be operated

principally outside the limits of the Commonwealth.

(17) The sale at retail or use of prescription or non-

prescription medicines, drugs or medical supplies, crutches and

wheelchairs for the use of cripples and invalids, artificial

limbs, artificial eyes and artificial hearing devices when

designed to be worn on the person of the purchaser or user,

false teeth and materials used by a dentist in dental treatment,

eyeglasses when especially designed or prescribed by an

ophthalmologist, oculist or optometrist for the personal use of

the owner or purchaser and artificial braces and supports

designed solely for the use of crippled persons or any other

therapeutic, prosthetic or artificial device designed for the

use of a particular individual to correct or alleviate a

physical incapacity, including but not limited to hospital beds,

iron lungs, and kidney machines.

(18) The sale at retail or use of coal.

(24) The sale at retail or use of motor vehicles, trailers

and semi-trailers, or bodies attached to the chassis thereof,

sold to a nonresident of Pennsylvania to be used outside of

Pennsylvania and which are registered in a state other than

Pennsylvania within twenty days after delivery to the vendee.

20210HB0307PN0276 - 30 -

(25) The sale at retail or use of water.

(26) The sale at retail or use of all vesture, wearing

apparel, raiments, garments, footwear and other articles of

clothing, including clothing patterns and items that are to be a

component part of clothing, worn or carried on or about the

human body but all accessories, ornamental wear, formal day or

evening apparel, and articles made of fur on the hide or pelt or

any material imitative of fur and articles of which such fur,

real, imitation or synthetic, is the component material of chief

value, but only if such value is more than three times the value

of the next most valuable component material, and sporting goods

and clothing not normally used or worn when not engaged in

sports shall not be excluded from the tax.

(28) The sale at retail or use of religious publications

sold by religious groups and Bibles and religious articles.

(29) The sale at retail or use of food and beverages for

human consumption, except that this exclusion shall not apply

with respect to--

(i) Soft drinks;

(ii) Malt and brewed beverages and spirituous and vinous

liquors;

(iii) Food or beverages, whether sold for consumption on or

off the premises or on a "take-out" or "to go" basis or

delivered to the purchaser or consumer, when purchased (A) from

persons engaged in the business of catering; or (B) from persons

engaged in the business of operating establishments from which

ready-to-eat food and beverages are sold, including, but not

limited to, restaurants, cafes, lunch counters, private and

social clubs, taverns, dining cars, hotels, night clubs, fast

food operations, pizzerias, fairs, carnivals, lunch carts, ice

20210HB0307PN0276 - 31 -

cream stands, snack bars, cafeterias, employe cafeterias,

theaters, stadiums, arenas, amusement parks, carryout shops,

coffee shops and other establishments whether mobile or

immobile. For purposes of this clause, a bakery, a pastry shop,

a donut shop, a delicatessen, a grocery store, a supermarket, a

farmer's market, a convenience store or a vending machine shall

not be considered an establishment from which food or beverages

ready to eat are sold except for the sale of meals, sandwiches,

food from salad bars, hand-dipped or hand-served iced based

products including ice cream and yogurt, hot soup, hot pizza and

other hot food items, brewed coffee and hot beverages. For

purposes of this subclause, beverages shall not include malt and

brewed beverages and spirituous and vinous liquors but shall

include soft drinks. The sale at retail of food and beverages at

or from a school or church in the ordinary course of the

activities of such organization is not subject to tax.

(30) The sale at retail or use of newspapers. For purposes

of this section, the term "newspaper" shall mean a "legal

newspaper" or a publication containing matters of general

interest and reports of current events which qualifies as a

"newspaper of general circulation" qualified to carry a "legal

advertisement" as those terms are defined in 45 Pa.C.S. § 101

(relating to definitions), not including magazines. This

exclusion shall also include any printed advertising materials

circulated with such newspaper regardless of where or by whom

such printed advertising material was produced.

(31) The sale at retail or use of caskets and burial vaults

for human remains and markers and tombstones for human graves.

(32) The sale at retail or use of flags of the United States

of America and the Commonwealth of Pennsylvania.

20210HB0307PN0276 - 32 -

(33) The sale at retail or use of textbooks for use in

schools, colleges and universities, either public or private

when purchased in behalf of or through such schools, colleges or

universities provided such institutions of learning are

recognized by the Department of Education.

(34) The sale at retail, or use of motion picture film

rented or licensed from a distributor for the purpose of

commercial exhibition.

(35) The sale at retail or use of mail order catalogs and

direct mail advertising literature or materials, including

electoral literature or materials, such as envelopes, address

labels and a one-time license to use a list of names and mailing

addresses for each delivery of direct mail advertising

literature or materials, including electoral literature or

materials, through the United States Postal Service.

(36) The sale at retail or use of rail transportation

equipment used in the movement of personalty.

(37) The sale at retail of buses to be used under contract

with school districts that are replacements for buses destroyed

or lost in the flood of 1977 for a period ending December 31,

1977 in the counties of Armstrong, Bedford, Cambria, Indiana,

Jefferson, Somerset and Westmoreland, or the use of such buses.

(38) The sale at retail of horses, if at the time of

purchase, the seller is directed to ship or deliver the horse to

an out-of-State location, whether or not the charges for

shipment are paid for by the seller or the purchaser; the seller

shall obtain a bill of lading, either from the carrier or from

the purchaser, who, in turn has obtained the bill of lading from

the carrier, reflecting delivery to the out-of-State address to

which the horse has been shipped. The seller shall execute a

20210HB0307PN0276 - 33 -

"Certificate of Delivery to Destination Outside of the

Commonwealth" for each bill of lading reflecting out-of-State

delivery. The seller shall be required to retain the certificate

of delivery form to justify the noncollection of sales tax with

respect to the transaction to which the form relates.

In transactions where a horse is sold by the seller and

delivered to a domiciled person, agent or corporation prior to

its being delivered to an out-of-State location, the

"Certificate of Delivery to Destination Outside of the

Commonwealth" form must have attached to it bills of lading both

for the transfer to the domiciled person, agent or corporation

and from the aforementioned to the out-of-State location.

(39) The sale at retail or use of fish feed purchased by or

on behalf of sportsmen's clubs, fish cooperatives or nurseries

approved by the Pennsylvania Fish Commission.

(40) The sale at retail of supplies and materials to tourist

promotion agencies, which receive grants from the Commonwealth,

for distribution to the public as promotional material or the

use of such supplies and materials by said agencies for said

purposes.

(41) The sale at retail of supplies and materials to tourist

promotion agencies, which receive grants from the Commonwealth,

for distribution to the public as promotional material or the

use of such supplies and materials by said agencies for said

purposes.

(42) The sale or use of brook trout (salvelinus fontinalis),

brown trout (Salmo trutta) or rainbow trout (Salmo gairdneri).

(43) The sale at retail or use of buses to be used

exclusively for the transportation of children for school

purposes.

20210HB0307PN0276 - 34 -

(44) The sale at retail or use of firewood. For the purpose

of this clause, firewood shall mean the product of trees when

severed from the land and cut into proper lengths for burning

and pellets made from pure wood sawdust if used for fuel for

cooking, hot water production or to heat residential dwellings.

(45) The sale at retail or use of materials used in the

construction and erection of objects purchased by not-for-profit

organizations for purposes of commemoration and memorialization

of historical events, provided that the object is erected upon

publicly owned property or property to be conveyed to a public

entity upon the commemoration or memorialization of the

historical event.

(46) The sale at retail or use of tangible personal property

purchased in accordance with the Food Stamp Act of 1977, as

amended (Public Law 95-113, 7 U.S.C. §§ 2011-2029).

(49) The sale at retail or use of food and beverages by

nonprofit associations which support sports programs or youth

centers. For purposes of this clause, the phrases:

(i) "nonprofit association" means an entity which is

organized as a nonprofit corporation or nonprofit unincorporated

association under the laws of this Commonwealth or the United

States or any entity which is authorized to do business in this

Commonwealth as a nonprofit corporation or unincorporated

association under the laws of this Commonwealth, including, but

not limited to, youth or athletic associations, volunteer fire,

ambulance, religious, charitable, fraternal, veterans, civic, or

any separately chartered auxiliary of the foregoing, if

organized and operated on a nonprofit basis;

(iv) "sports program" means baseball (including softball),

football, basketball, soccer and any other competitive sport

20210HB0307PN0276 - 35 -

formally recognized as a sport by the United States Olympic

Committee as specified by and under the jurisdiction of the

Amateur Sports Act of 1978 (Public Law 95-606, 36 U.S.C. § 371

et seq.), the Amateur Athletic Union or the National Collegiate

Athletic Association. The term shall be limited to a program or

that portion of a program that is organized for recreational

purposes and whose activities are substantially for such

purposes and which is primarily for participants who are 18

years of age or younger or whose 19th birthday occurs during the

year of participation or the competitive season, whichever is

longer. There shall, however, be no age limitation for programs

operated for persons with physical handicaps or persons with

mental retardation;

(v) "support" means:

(A) the funds raised from sales are used to pay the expenses

of a sports program or a youth center; or

(B) the nonprofit association sells the food and beverages

at a youth center or a location where a sports program is being

conducted under this act;

(vi) "youth center" means a fixed location used exclusively

for programs for individuals who are 19 years of age or younger

as long as the programs are:

(A) conducted primarily by volunteers;

(B) designed to advance recreational, civic or moral

objectives; and

section 501(c)(3) of the Internal Revenue Code of 1986 (Public

Law 99-514, 26 U.S.C. § 501(c)(3)) and that has obtained an

exemption number from the department as a charitable

organization under clause (10).

20210HB0307PN0276 - 36 -

(50) The sale at retail or use of subscriptions for

magazines. The term "magazine" refers to a periodical published

at regular intervals not exceeding three months and which are

circulated among the general public, containing matters of

general interest and reports of current events published for the

purpose of disseminating information of a public character or

devoted to literature, the sciences, art or some special

industry. This exclusion shall also include any printed

advertising material circulated with the periodical or

publication regardless of where or by whom the printed

advertising material was produced.

(51) The sale at retail or use of interior office building

cleaning services but only as relates to the costs of the

supplied employe, which costs are wages, salaries, bonuses and

commissions, employment benefits, expense reimbursements, and

payroll and withholding taxes, to the extent that these costs

are specifically itemized or that these costs in aggregate are

stated in billings from the vender or supplying entity.

(53) The sale at retail or use of candy or gum regardless of

the location from which the candy or gum is sold.

(55) The sale at retail or use of horses to be used

exclusively for commercial racing activities and the sale at

retail and use of feed, bedding, grooming supplies, riding tack,

farrier services, portable stalls and sulkies for horses used

exclusively for commercial racing activities.

(56) The sale at retail or use of tangible personal property

or services used, transferred or consumed in installing or

repairing equipment or devices designed to assist persons in

ascending or descending a stairway when:

(i) The equipment or devices are used by a person who, by

20210HB0307PN0276 - 37 -

virtue of a physical disability, is unable to ascend or descend

stairs without the aid of such equipment or device.

(ii) The equipment or device is installed or used in such

person's place of residence.

(iii) A physician has certified the physical disability of

the person in whose residence the equipment or device is

installed or used.

(57) The sale at retail to or use by a construction

contractor of building machinery and equipment and services

thereto that are:

(i) transferred pursuant to a construction contract for any

charitable organization, volunteer firemen's organization,

volunteer firefighters' relief association, nonprofit

educational institution or religious organization for religious

purposes, provided that the building machinery and equipment and

services thereto are not used in any unrelated trade or

business; or

(ii) transferred to the United States or the Commonwealth or

its instrumentalities or political subdivisions; or

(58) The sale at retail or use of a personal computer, a

peripheral device or an Internet access device, or a service

contract or single-user licensed software purchased in

conjunction with a personal computer, peripheral device or

Internet access device, during the exclusion period by an

individual purchaser for nonbusiness use. The exclusion does not

include a sale at retail or use of, leasing, rental or repair of

a personal computer, peripheral device or Internet access

device; mainframe computers; network servers; local area network

hubs; routers and network cabling; network operating systems;

multiple-user licensed software; minicomputers; hand-held

20210HB0307PN0276 - 38 -

computers; personal digital assistants without Internet access;

hardware word processors; graphical calculators; video game

consoles; telephones; digital cameras; pagers; compact discs

encoded with music or movies; and digital versatile discs

encoded with music or movies. For purposes of this clause, the

phrase "exclusion period" means the period of time from August

5, 2001, to and including August 12, 2001, and from February 17,

2002, to and including February 24, 2002. For purposes of this

clause, "purchaser" means an individual who places an order and

pays the purchase price by cash or credit during the exclusion

period even if delivery takes place after the exclusion period.

(59) The sale at retail or use of molds and related mold

equipment used directly and predominantly in the manufacture of

products, regardless of whether the person that holds title to

the equipment manufactures a product.

(60) The sale or use of used prebuilt housing.

(61) The sale at retail to or use of food and nonalcoholic

beverages by an airline which will transfer the food or

nonalcoholic beverages to passengers in connection with the

rendering of the airline service.

(62) The sale at retail or use of tangible personal property

or services which are directly used in farming, dairying or

agriculture when engaged in as a business enterprise whether or

not the sale is made to the person directly engaged in the

business enterprise or to a person contracting with the person

directly engaged in the business enterprise for the production

of food.

(63) The sale at retail or use of separately stated fees

paid pursuant to 13 Pa.C.S. § 9525 (relating to fees).

(64) The sale at retail to or use by a construction

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contractor, employed by a public school district pursuant to a

construction contract, of any materials and building supplies

which, during construction or reconstruction, are made part of

any public school building utilized for instructional classroom

education within this Commonwealth, if the construction or

reconstruction:

(i) is necessitated by a disaster emergency, as defined in

35 Pa.C.S. § 7102 (relating to definitions); and

(ii) takes place during the period when there is a

declaration of disaster emergency under 35 Pa.C.S. § 7301(c)

(relating to general authority of Governor).

(65) The sale at retail or use of investment metal bullion

and investment coins. "Investment metal bullion" means any

elementary precious metal which has been put through a process

of smelting or refining, including, but not limited to, gold,

silver, platinum and palladium, and which is in such state or

condition that its value depends upon its content and not its

form. "Investment metal bullion" does not include precious metal

which has been assembled, fabricated, manufactured or processed

in one or more specific and customary industrial, professional,

aesthetic or artistic uses. "Investment coins" means numismatic

coins or other forms of money and legal tender manufactured of

gold, silver, platinum, palladium or other metal and of the

United States or any foreign nation with a fair market value

greater than any nominal value of such coins. "Investment coins"

does not include jewelry or works of art made of coins, nor does

it include commemorative medallions.

(66) The sale at retail or use of copies of an official

document sold by a government agency or a court. For the

purposes of this clause, the following terms or phrases shall

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have the following meanings:

(i) "court" includes:

(A) an "appellate court" as defined in 42 Pa.C.S. § 102

(relating to definitions);

(B) a "court of common pleas" as defined in 42 Pa.C.S. §

102;

(ii) "government agency" means an "agency" as defined in

section 1 of the act of June 21, 1957 (P.L.390, No.212),

referred to as the "Right-to-Know Law";

(iii) "official document" means a "record" as defined in

section 1 of the "Right-to-Know Law." The term shall include

notes of court testimony, deposition transcripts, driving

records, accident reports, birth and death certificates, deeds,

divorce decrees and other similar documents.

(67) The sale at retail or use of repair or replacement

parts, including the installation of those parts, exclusively

for use in helicopters and similar rotorcraft or in overhauling

or rebuilding of helicopters and similar rotorcraft or

helicopters and similar rotorcraft components.

(68) The sale at retail or use of helicopters and similar

rotorcraft.

(69) The sale at retail or use of aircraft parts, services

to aircraft and aircraft components. For purposes of this

clause, the term "aircraft" shall include a fixed-wing aircraft,

powered aircraft, tilt-rotor or tilt-wing aircraft, glider or

unmanned aircraft.

(70) The sale at retail or use of services related to the

set up, tear down or maintenance of tangible personal property

rented by an authority to exhibitors at a convention center or a

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public auditorium, established under 64 Pa.C.S. Ch. 60 (relating

to Pennsylvania Convention Center Authority), the act of July

28, 1953 (P.L.723, No.230), known as the Second Class County

Code, or the act of August 9, 1955 (P.L.323, No.130), known as

The County Code.

(71) The sale at retail or use of food and beverages by a

volunteer firemen's organization to raise funds for the purposes

of the volunteer firemen's organization.

(72) The sale at retail of building materials and supplies

used for the construction or repair of an animal housing

facility, regardless if the sale is made to the purchaser

directly or pursuant to a construction contract.

(73) The sale at retail or use by a financial institution of

canned computer software directly utilized in conducting the

business of banking. for the purposes of this clause, the

following words and phrases shall have the following meanings:

"Directly utilized in conducting the business of banking"

includes the purchase of canned computer software by a financial

institution to be used in transactions with customers and

service providers. The term does not include the purchase of

canned computer software by entities, other than a financial

institution, such as holding companies and subsidiaries of a

financial institution.

"Financial institution" means an institution doing business

in this commonwealth subject to the tax imposed by Article VII

or Article XV.]

Section 4. Sections 205, 281.2 and 201-B(b) of the act are

amended to read:

Section 205. Alternate Imposition of Tax; Credits.--(a) If

any person actively and principally engaged in the business of

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selling new or used motor vehicles, trailers or semi-trailers,

and registered with the department in the "dealer's class,"

acquires a motor vehicle, trailer or semi-trailer for the

purpose of resale, and prior to such resale, uses the motor

vehicle, trailer or semi-trailer for a taxable use under this

act, the person may pay a tax equal to [six] one and nine-

tenths per cent of the fair rental value of the motor vehicle,

trailer or semi-trailer during such use. This section shall not

apply to the use of a vehicle as a wrecker, parts truck,

delivery truck or courtesy car.

(b) A commercial aircraft operator who acquires an aircraft

for the purpose of resale, or lease, or is entitled to claim

another valid exemption at the time of purchase, and subsequent

to such purchase, periodically uses the same aircraft for a

taxable use under this act, may elect to pay a tax equal to

[six] one and nine-tenths per cent of the fair rental value of

the aircraft during such use.

Section 281.2. Transfers to Public Transportation Assistance

Fund.--[(a) All revenues received on or after July 1, 1992,

from the imposition of the tax on periodicals shall be

transferred to the Public Transportation Assistance Fund

according to the formula set forth in subsection (b).

(b) Within 30 days of the close of any calendar month, .44

per cent (.0044) of the taxes received in the previous month

under this article, less any amounts collected in that previous

calendar month under former 74 Pa.C.S. § 1314(d) (relating to

Public Assistance Transportation Fund), shall be transferred to

the Public Transportation Assistance Fund established under

Article XXIII.

20210HB0307PN0276 - 43 -

ensure that ten million dollars ($10,000,000) is deposited in

the Public Assistance Transportation Fund from the combination

of revenues received under former 74 Pa.C.S. § 1314(d) and

transfers of periodical taxes received under this article.

(d) Within 30 days of the close of any calendar month, .09

per cent (.0009) of the taxes received in the previous month

under this article shall be transferred to the Public

Transportation Assistance Fund established under Article XXIII.

(e) Within 30 days of the close of a calendar month, .417

per cent (.00417) of the taxes received in the previous month

under this article shall be transferred to the Public

Transportation Assistance Fund established under Article XXIII.]

Within 30 days of the close of a calendar month, .3 per cent

(0.003) of the taxes received in the previous month under this

article shall be transferred to the Public Transportation

Assistance Fund established under Article XXIII.

Section 201-B. Special taxing authority.

* * *

(b) Rate.--The tax authorized under subsection (a) shall be

imposed and collected at the rate of [1%] 0.32% and shall be

computed as set forth in section 503(e)(2) of the Pennsylvania

Intergovernmental Cooperation Authority Act for Cities of the

First Class.

* * *

Section 5. The Secretary of the Commonwealth shall submit to

the Legislative Reference Bureau a notice for publication in the

Pennsylvania Bulletin if the General Assembly has enacted all of

the following:

(1) An act that reduces the rate of tax imposed under

section 3152-B of the act of July 28, 1953 (P.L.723, No.230),

20210HB0307PN0276 - 44 -

known as the Second Class County Code, in a manner that would

result in the revenue generated by the tax imposed under

section 3152-B of the Second Class County Code, being revenue

neutral, subject to the repeal of exclusions from the sales

and use tax in this act, in comparison to the amount

generated in the prior fiscal year.

(2) An act that reduces the rate of tax imposed under

section 503(a) and (b) of the act of June 5, 1991 (P.L.9,

No.6), known as the Pennsylvania Intergovernmental

Cooperation Authority Act for Cities of the First Class, in a

manner that would result in the revenue generated by the tax

being revenue neutral, subject to the repeal of exclusions

from the sales and use tax in this act, in comparison to the

amount generated in the prior fiscal year.

(3) An act that reduces the amount deposited into the

Public Transportation Trust Fund under 74 Pa.C.S. § 1506(c)

(1).

Section 6. This act shall take effect as follows:

(1) Section 5 of this act and this section shall take

effect immediately.

(2) The remainder of this act shall take effect upon

publication of the notice under section 5 of this act.

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