RYAN ONLINE

Tax Developments


October 19, 2012
FOR IMMEDIATE RELEASE

Pennsylvania Supreme Court Affirms that Pallets Are Not Containers, Making Them Eligible for Sales Tax Exemption.

On October 16, 2012, the Pennsylvania Supreme Court upheld the decision of the Commonwealth Court that pallets are not “containers” for sales tax purposes. No. 113 MAP 2011, affirming Proctor & Gamble Paper Products Co. v. Commonwealth of Pennsylvania (No. 786 F.R. 2009, decided October 13, 2011). Because of this decision, returnable pallets qualify for Pennsylvania’s sales tax exemption for wrapping supplies purchased or used by a seller.

The wrapping supplies exemption specifically excludes returnable containers. The law defines “returnable containers” as items designed to deliver property to customers more than one time. Because the law does not define “containers,” the Commonwealth Court used the plain meaning and common description of a “container,” which is a receptacle or a formed or flexible covering for packing or shipping goods. Based on this definition, the Supreme Court affirmed the Commonwealth Court’s determination that pallets alone are flooring, not containers. Because pallets are not returnable containers, they qualify for the sales tax exemption for wrapping supplies.

TECHNICAL INFORMATION CONTACT:

Dennis J. Kolumber, Jr.
Principal
Ryan
484.253.7000
dennis.kolumber@ryan.com
The Ryan Tax Gateway® is a free service provided to tax professionals. Ryan disclaims responsibility for applying the information contained on these sites to any specific set of facts. For questions and suggestions, please e-mail info@ryan.com.
Ryan Abandoned and Unclaimed Property Alert: Delaware Unclaimed Property Voluntary Disclosure Program Update.
A deadline is quickly approaching for unclaimed property, creating a limited window of time for businesses to take action. As of June 30, 2014, the... >More

Minnesota Sales and Use Tax: Equipment Exemption Enacted.
Minnesota Governor Mark Dayton signed legislation that exempts sales and purchases for telecommunications or pay television services machinery and equipment from sales and use tax... >More


©1999-2014 Ryan, LLC. All rights reserved.   
Facebook   Twitter   YouTube   LinkedIn   RSS RSS