The Governor of Pennsylvania has recently signed the fiscal year revenue plan proposed under PA House Bill 542. The plan, which was the product of a spirited debate, creates new compliance obligations on remote sellers. Specifically, the new law requires many marketplace facilitators, marketplace sellers, and remote sellers to notify purchasers of their obligation to self-remit tax to the PA Department of Revenue on their purchases. As has been true in other states, notice requirements can be avoided by opting to collect and remit tax. In the case of PA, the election to collect and remit must be made on or before March 1, 2018, and then on or before June 1, each year thereafter.
The language of the new law is not particularly clear as to its effective date. Parts of the bill suggest that it applies to transactions occurring on or after April 1, 2018, unless the transaction involves tangible personal property, in which case the obligation applies to transactions on or after April 1, 2019. However, In a later section the relative effective dates appear to be February 1, 2018 and February 1, 2019 respectively.
We expect further clarity on this requirement to be provided by the Pennsylvania DOR. In addition, SOVOS has requested information from the bill’s legislative sponsors so as to more fully understand the requirements. Stay tuned through this forum for additional details as they develop.
About the Author
Katie Smethurst is a Junior Regulatory Counsel at Sovos. Within Sovos’ Regulatory Counsel function, Katie focuses primarily on international and U.S. based indirect tax research and analysis. Katie is a member of the Massachusetts and New Hampshire Bars, earned her B.A. from Roger Williams University and earned her J.D. from Suffolk University Law School.More Content by Kaitlyn Smethurst