Sales Tax Obligations of Purchasers in Pennsylvania

April 13, 2006

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Pennsylvania imposes various requirements on purchasers doing business in Pennsylvania. We recommend that you go through the items below to help you with the most frequently asked questions concerning purchasers and sales and use tax issues.

Tax exemption certificates. In Pennsylvania nonprofit organizations, charitable, religious, and educational institutions are exempt from sales tax. An organization must file an Application for Sales Tax Exempt Status with the Department of Revenue and will be issued an exemption number (prefixed by the digits "75") if it qualifies for exempt status. Only organizations that hold an exemption number may make tax-free purchases. All purchases must be accompanied by a Sales and Use Tax Exemption certificate, which includes the exemption number and the following language: "Property and/or services are being purchased for use and not for resale by purchaser holding exemption number 75-".

Resale exemptions. In Pennsylvania, if you sell tangible personal property or render services for purposes of resale it is not subject to sales and use tax.

Resale exemption certificate. In Pennsylvania, the state form entitled "Sales and Use Tax Exemption Certificate" is used by purchasers that will be reselling the goods purchased. Contact the Pennsylvania Department of Revenue if you need the exemption form.

Blanket resale certificate. In Pennsylvania a purchaser may give a "blanket" resale certificate to a seller covering a series of transactions between purchaser and seller. This blanket certificate will relieve the burden of executing a separate certificate for each individual tax-exempt purchase as long as there is no significant change in the operations.

Purchases from out-of-state vendors. If you make a purchase of tangible personal property from on out-of-state vendor, Pennsylvania will allow you a credit against use tax equal to the tax paid to another state. However, no credit is granted unless the other state grants substantially similar tax relief.