Pennsylvania shoppers must now pay taxes on more online sales - WFMJ.com News weather sports for Youngstown-Warren Ohio

Pennsylvania shoppers must now pay taxes on more online sales

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A law that went into effect over the weekend means customers who frequently shop online in Pennsylvania could see an important change in their shopping. 

It's a new law requiring companies that ship or sell goods to customers in Pennsylvania collect sales tax that went into effect on Easter Sunday. 

The new mandate requires the tax collection even if the business has no physical address in Pennsylvania. Meaning any company that sells more than $10,000 worth of merchandise to Pennsylvania customers will be on the hook to collect the taxes.

But according to CNBC, it isn't just companies like Walmart and Home Depot that will now be held responsible for collecting the tax, many of which already collect sales tax in the state, the law also requires sites which advertise goods for sale and/or assist in the sale process, which could potentially impact sites like Amazon and eBay, which helps third-party sellers coordinate sales. 

According to CNBC, Pennsylvania is only the second state to require such a practice. 

Under the law, there is an exemption that allows companies to put the burden on the customers.  

According to the Pennsylvania Department of Revenue, the companies could elect to comply with "notice and reporting requirements". However, they were only allowed to do that until March 1st. 

For those companies who have elected to do that, the guidelines make it necessary that the businesses post on their forum a written warning to customers. The Department of Revenue's website reads: 

Post a notice on its forum that states:
Pennsylvania sales or use tax may be due in connection with the purchase and delivery of tangible personal property to Pennsylvania individuals and businesses.

The purchaser is required to file a use tax return if tax is due in connection with the purchase and delivery in the Commonwealth.

This notice is required pursuant to the provisions of the Tax Reform Code of 1971. 72 P.S. § 7213.2.

Provide a written notice on all invoices, order forms, sales receipts or similar documents, whether in paper or electronic form, to each purchaser at the time of each sale that states:
Pennsylvania sales tax was not collected on this sale. Therefore, you may be required to remit use tax directly to the Commonwealth on your purchase if the items are subject to Pennsylvania sales tax. Please visit this link to learn more about your use tax obligations under Pennsylvania law.

If the company itself does not collect the sales tax, the customers who bought the item must then file a "use tax" on the item.

The customer could be subject to fines and late fees if the taxes aren't paid on time. 

The Department of Revenue says individuals have the option of paying use tax on their personal purchases by using line 25 on the PA-40 Personal Income Tax Return. Use tax reported and remitted as part of the return is considered timely filed if the income tax return is timely filed.

The use tax rate is the same as the sales tax rate: 6 percent state tax, plus an additional 1 percent local tax for items purchased in, delivered to or used in Allegheny County, and 2 percent local tax for items purchased in, delivered to or used in Philadelphia.

However, the entire issue could be a moot point, according to opponents of the tax. 

Companies like Amazon have argued that a 1992 Supreme Court ruling, which said that states could not collect sales tax on mail order catalogs from companies which had no physical address in the state, should be applied. 

The Supreme Court is expected to hear arguments on the internet sales tax laws this month and rule on the matter in June. 

36 states have signed on to the lawsuit asking the Supreme Court to rule that online retailers should be forced to collect the taxes, which they argue would mean increases in revenue for states that need the money. 

Until the court rules, however, the taxes will be collected in the Keystone State. More information on the law can be found here. 

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