Posted November 12, 2013
A bill, which would amend the Pennsylvania tax code to exempt timber companies from paying sales and use tax on items used directly in their operations, will be considered by the state House of Representatives on Wednesday, according to an article by the Bradford Era available here.
House Bill 1138 was introduced by Pennsylvania state Representative Matt Gabler (R-DuBois), to extend a sales tax exclusion for timber harvesters. The tax exclusion already exists for agriculture, manufacturing, and sawmills.
Gabler explained that the intent of the legislation is to prevent compounding taxation on timber harvesters. The legislation has been reported by the House Finance Committee and will be examined by the House Appropriations Committee for the fiscal impact of omitting that stream of tax revenue.
Examples of the current sales tax exclusion that applies to agricultural operations include tractors, combines, tools, feed, and fertilizers that go directly into the farming operation, according to Gabler.
“The irony in current law has the very same sawmill industry that works hand-in-hand with the timber industry exempt from sales and use tax…The timber industry belongs in the same category with farming, dairy, and manufacturing in being excluded from what essentially is double-taxation, since sales tax is charged at retail on the final product.” A press release from Rep. Gabler’s office is available here.
For more information on timber law, please visit the National Agricultural Law Center’s website here.
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