THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY MILLER, GROVE, MICOZZIE, PYLE, ROCK, VULAKOVICH AND QUINN, JANUARY 24, 2011

REFERRED TO COMMITTEE ON FINANCE, JANUARY 24, 2011  

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

exclusions from tax and for exemption certificates.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 204(10) of the act of March 4, 1971 (P.L.

6, No.2), known as the Tax Reform Code of 1971, amended April

23, 1998 (P.L.239, No.45), is amended to read:

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

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

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

organization, volunteer firemen's organization, volunteer

firefighters' relief association as defined in section 2 of the

act of June 11, 1968 (P.L.149, No.84), known as the "Volunteer

Firefighters' Relief Association Act," 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.

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Section 2.  Section 237(c) of the act, amended July 1, 1985

(P.L.78, No.29), is amended and the section is amended by adding

a subsection to read:

Section 237.  Collection of Tax.--* * *

(c)  Exemption Certificates. If the tax does not apply to the

sale or lease of tangible personal property or services, the

purchaser or lessee shall furnish to the vendor a certificate

indicating that the sale is not legally subject to the tax. The

certificate shall be in substantially such form as the

department may, by regulation, prescribe. Where the tangible

personal property or service is of a type which is never subject

to the tax imposed or where the sale or lease is in interstate

commerce, such certificate need not be furnished. Where a series

of transactions are not subject to tax, a purchaser or user may

furnish the vendor with a single exemption certificate in

substantially such form and valid for such period of time as the

department may, by regulation, prescribe[.], provided that an

exemption certificate furnished to a volunteer firefighters'

relief association or volunteer firemen's organization shall be

considered permanent. The department shall provide all school

districts and intermediate units with a permanent tax exemption

number. An exemption certificate, which is complete and regular

and on its face discloses a valid basis of exemption if taken in

good faith, shall relieve the vendor from the liability imposed

by this section. An exemption certificate accepted by a vendor

from a natural person domiciled within this Commonwealth or any

association, fiduciary, partnership, corporation or other

entity, either authorized to do business within this

Commonwealth or having an established place of business within

this Commonwealth, in the ordinary course of the vendor's

business, which on its face discloses a valid basis of exemption

consistent with the activity of the purchaser and character of

the property or service being purchased or which is provided to

the vendor by a charitable, religious, educational, volunteer

firefighters' relief association or volunteer firemen's

organization and contains the organization's charitable

exemption number and which, in the case of any purchase costing

two hundred dollars ($200) or more, is accompanied by a sworn

declaration on a form to be provided by the department of an

intended usage of the property or service which would render it

nontaxable, shall be presumed to be taken in good faith and the

burden of proving otherwise shall be on the Department of

Revenue.

(c.1)  Surrender of Exemption Certificate. If a volunteer

firefighters' relief association or volunteer firemen's

organization that has been furnished an exemption certificate

dissolves, the association or organization shall have sixty days

to surrender the exemption certificate to the department.

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Section 3.  This act shall take effect immediately.