Sales, Use and Hotel Occupancy Tax

The sales and use tax is imposed on the retail sale, consumption, rental or use of tangible personal property including - digital products - in Pennsylvania. The tax is also imposed on certain services relating to such property and on the charge for specific business services. Major items exempt from the tax include food (not ready-to-eat); candy and gum; most clothing; textbooks; computer services; pharmaceutical drugs; sales for resale; and residential heating fuels such as oil, electricity, gas, coal and firewood.

The Pennsylvania sales tax rate is 6 percent. By law, a 1 percent local tax is added to purchases made in Allegheny County, and 2 percent local tax is added to purchases made in Philadelphia.

See the Retailer's Information Guide (REV-717) or the more detailed Taxability Lists for a taxable items to review subjectivity to sales tax of goods and services.

A use tax, at the same rate as sales tax, is due on taxable purchases of tangible personal property or specified services used or consumed in Pennsylvania where no sales tax is paid to a vendor. For example, the purchase may have been made out-of-state.

The hotel occupancy tax, imposed at the same rate as sales tax, applies to room rental charges for periods of less than 30 days by the same person. In addition to hotels, the tax applies to rentals of rooms, apartments and houses arranged through online or third-party brokers.

For detailed and historic sales, use and hotel occupancy tax information, please review the Tax Compendium.

Types of Sales Tax Licenses

Promoter License – Required for any person who either directly or indirectly rents, leases, or otherwise operates or grants permission to use space at a show for the display/sale of tangible personal property or services subject to tax.

Sales, Use and Hotel Occupancy Retail Tax License – Required for any business that sells taxable items or performs taxable services.

Transient Vendor Certificate – Required for any non-Pennsylvania enterprise (sole proprietorship or partnership) that does not have a permanent, physical business location in Pennsylvania, and is selling taxable, tangible, personal property or performs taxable services in Pennsylvania.

Wholesale Certificate – Required for any business that only sells to retailers.

To register for a Promoter License; Sales, Use and Hotel Occupancy Retail Tax License; Transient Vendor Certificate; or Wholesale Certificate, complete the Pennsylvania Online Business Tax Registration at myPATH.

Hotel Occupancy Tax – Booking Agent License – Required when renting out a property – including a home, room, or apartment – to provide lodging to a guest for a period fewer than 30 days.  This license is used to report only the hotel occupancy tax collected on the booking agent’s accommodation fee.  For more information on Booking Agents, please visit Hotel Occupancy Tax – Booking Agents.

To obtain a Hotel Occupancy Tax – Booking Agent License, complete the Hotel Booking Agent Registration Form (REV-1840) and email it to RA-BTFTDIRECTORFAX@PA.GOV or fax it to 717-705-8994.