Pennsylvania sales tax for businesses

From boutique retailers in downtown Philadelphia to family-owned restaurants in Pittsburgh and mobile food trucks serving events across Scranton and the surrounding counties, Pennsylvania businesses face a sales tax system that looks simple on the surface but can get complex fast. Local surtaxes, special rules for food, and electronic filing requirements mean small mistakes can turn into time-consuming fixes. 

This guide breaks Pennsylvania sales tax down into practical, plain-English steps so business owners can stay compliant without losing focus on running their business.

What is the Pennsylvania sales tax?

Pennsylvania imposes a statewide 6% sales and use tax on the retail sale, use, lease, or rental of tangible personal property and certain services. Local jurisdictions may add their own surtaxes, which means the total rate depends on where the sale occurs.

The Commonwealth of Pennsylvania Department of Revenue (PA DOR) explains local surtaxes and how location impacts your collection rate in its Retailer’s Information Guide (REV-717). 

Note: Local rates can change. Always verify the current rate for your business address using the official PA DOR website.

How to calculate Pennsylvania sales tax?

Pennsylvania sales tax calculation follows a simple formula:

Sale price × (State Rate + Local Rate) = sales tax due

For example, if a retailer in Philadelphia sells a $100 taxable item, the total sales tax would be:

$100 × 8% = $8 in sales tax

The customer pays $108 total. The business is responsible for holding and remitting the $8 to the state.

Using our reverse sales tax calculator

Businesses can get tripped up when they want to display tax-included pricing or operate in more than one location. A restaurant group with locations in both Pittsburgh and Scranton, or a food truck moving between Philadelphia neighborhoods, cannot rely on a single flat rate. When prices are tax-inclusive, even a small difference in local rates can lead to under- or over-reporting sales tax if the math is done manually.

That’s where a reverse sales calculator can come in handy. For example, imagine a food truck in Philadelphia sells a combo meal for $10, tax-included. Using a reverse sales tax calendar, the owner can enter the local sales tax rate to back out how much of that $10 is tax versus revenue. This is critical for accurate reporting and prevents underpaying taxes due to rounding errors.

What is subject to sales tax in Pennsylvania?

Pennsylvania taxes most tangible goods and some specific services. Common taxable items include:

• Clothing accessories such as belts and formal wear
• Furniture and home décor
• Electronics and appliances
• Prepared food and beverages sold for immediate consumption
• Alcoholic beverages
• Tobacco and vaping products
• Digital products

The Department of Revenue details taxable property categories in its Retailer’s Information Guide (REV-717).

Does Pennsylvania charge sales tax on services?

Most services are not taxable in Pennsylvania, but there are important exceptions. Taxable services include:

• Telecommunications services
• Certain digital products and software
• Repair and maintenance services for tangible personal property, like lawn care and pest control
• Lobbying services
• Credit reporting services
• Secretarial or editing services
• Self-storage services

Because service taxation varies by category, many businesses misclassify taxable services as exempt. Reviewing the section on taxable services on the PA DOR Retailer’s Information Guide (REV-717) can prevent costly corrections later.

Pennsylvania economic nexus and remote sellers

Even if you do not have a physical retail presence in Pennsylvania, you may be liable for collecting and remitting sales tax. Pennsylvania enforces economic nexus rules for remote sellers and marketplace facilitators. 

Economic presence in Pennsylvania is measured by sales threshold only. When a business exceeds $100,000 in gross sales within the state during the previous 12-month period, it must register and collect Pennsylvania sales tax and file returns. 

Marketplace facilitators such as large online platforms are generally responsible for collecting and remitting tax on behalf of third-party sellers. However, marketplace sellers should still track their Pennsylvania sales carefully, especially if they sell through multiple channels. The PA DOR outlines these rules in the Sales and Use Tax Bulletin 2019-01.

Pennsylvania sales tax on food

Food taxation in Pennsylvania depends on how the food is prepared and sold. Grocery staples intended for home consumption are generally exempt, while prepared food is usually taxable. For example:

• A grocery store selling packaged bread does not collect the 6% state sales tax.
• A café selling hot sandwiches must collect the 6% state sales tax, plus applicable local tax.
• A food truck selling ready-to-eat meals must collect the state sales tax, plus the local rate where the sale occurs.

This is where automation becomes especially valuable. DAVO by Avalara helps restaurants, cafés, and food trucks automatically set aside the correct amount of sales tax per transaction and remit it on time, even when operating across multiple jurisdictions with different rates.

Find more information about what food is taxable and recordkeeping requirements in Pennsylvania’s Sales Tax in the Restaurant Industry document.

What is exempt from sales tax in Pennsylvania?

Pennsylvania provides a number of exemptions that benefit both businesses and consumers. Common exemptions include:

• Most unprepared/grocery food items
• Prescription drugs and medical devices
• Clothing for everyday wear
• Newspapers and magazines
• Manufacturing machinery and equipment used directly in production
• Items purchased for resale

Exemptions are explained in detail in the Pennsylvania Sales, Use and Hotel Occupancy Tax Liability Lists.

How to manage tax-exempt sales in Pennsylvania?

When selling exempt items or selling to exempt organizations, you need to maintain proper documentation. Collect a completed Pennsylvania Exemption Certificate (Form REV-1220), and keep it on file. If documentation is missing or incomplete, your business may be held liable for the tax during an audit. 

Pennsylvania sales tax holiday

Pennsylvania does not currently offer a recurring statewide sales tax holiday. Any tax-free promotions should clearly state they are store-funded discounts rather than any sort of statutory exemption.

How to register for a Pennsylvania sales tax license?

If you are required to file sales tax, apply for a Sales, Use and Hotel Occupancy Tax License first. New customers can register for various taxes without logging in to the PA myPATH online portal. On the myPATH website, in the Registration section, click the Pennsylvania Online Business Tax Registration link.

If you are already registered to use myPATH, log in and use the Register New Business Tax Accounts feature. This includes individuals registering a business as a sole proprietorship.

Applicants will need:

• The legal name of the business
• The name by which the business is doing business as (dba, commonly known as, trading as, also known as), if applicable
• The Internal Revenue Service Employer Identification number (EIN) 
• Department of State Entity Number, if applicable
• The business addresses and contact information
• Banking information for Tobacco Products License fees, if applicable
• The name(s), home address(es) and Social Security Number or Individual Taxpayer Identification Number of the owners/officers/other responsible parties. 
• If you’ve received a Notice of Required Registration letter from the PA DOR, have the Letter ID available.

There is no fee to register for a license.

Most businesses receive their sales tax account number within a few business days after completing registration. Once your application is processed, you will be able to file and pay taxes online. Use the information on your confirmation email to sign up for myPath.

How to file Pennsylvania sales tax?

Pennsylvania requires most businesses to file sales tax returns electronically, specifically if your sales tax liability is $15,000 or more annually. If you have no taxes due for a filing period, you must still submit a return. Failure to file zero-dollar returns can trigger penalties and notices.

File Pennsylvania sales tax returns using one of the following options:

• myPATH
  • Log in to myPATH
  • From the Summary tab, locate the Sales and Use Tax account panel. 
  • Select the File Now link to file for the current period.
  • Select the View Returns and Periods link from the Account panel.
    • Select the Period link for the period you are filing.
    • Select the File or amend a return or File now link.
  • Indicate whether you have Pennsylvania sales to report by selecting either Yes or No:
    • If you selected Yes to any of the required questions, enter your sales information into the Taxable Sales step, including any required Clean Indoor Air Act information (if applicable).
      • When ready, select Next to review your return figures.

• TeleFile:
  • In order to use TeleFile, you must submit a TeleFile Request Form and cite the reason why you can’t file online/electronically. 
  • To obtain the Telefile Request Form and receive further instructions, call 1-800-748-8299 or 717-787-1064.
  • Submit the request form at least 30 days before the tax due date so the department has enough time to update your account.
  • After your request is approved, you will need the following filing information:
    • Eight-digit Sales Tax Account ID Number
    • Nine-digit FEIN or Social Security number, or your 10-digit Revenue ID
    • Tax period end date
    • PA state gross sales, rentals, and services
    • PA net taxable sales, rentals, and services
    • The amount of use tax due
    • E-911 fee, if applicable
    • Any applicable credits – (Taxes Paid/Purchases Resold Credit or other)
    • Corresponding sales tax amounts for Philadelphia and/or Allegheny Counties, if applicable.

How to pay Pennsylvania sales tax?

The Department of Revenue accepts several payment methods via myPATH, including:

• ACH debit: Provide your banking information.
  • Select either Checking or Savings for the account type. 
  • Enter your financial institution’s routing number and your account number.
  • The department strongly recommends that you contact your financial institution to authorize ACH Debit transactions and to verify the bank account and routing numbers required for electronic payments.
• EFT/ACH credit
• Credit card
  • After submitting the return, navigate to the Summary tab.
  • Select the Make a Payment link from the Sales and Use Tax account panel.
  • American Express, Discover, MasterCard, or Visa credit card
  • MasterCard or Visa debit card
  • ACI Payments, Inc. charges a convenience fee per each credit card and debit card transaction
• Mail a check
  • Make the check payable to the PA Department of Revenue. 
  • Note on the check:
    • PA Sales/Use Tax License Number
    • FEIN or Revenue ID
    • The tax period begins and end dates
  • You must make payments of $1,000 or more electronically or by certified/cashier’s check. 
  • Remit a certified or cashier’s check in person or by express mail delivery service, along with the tax documents that are due, on or before 4 p.m. Eastern Time on the tax due date. 
  • Send payments to:

PA Department of Revenue
1854 Brookwood St.
Harrisburg, PA 17104

• Mail checks for under $1,000 to:

PA Department of Revenue
PO Box 280404
Harrisburg, PA 17128-0404

If you are unable to pay in full, payment options are available. To set up a payment plan, you have two options:

• Email RA-RV-CEC-DPP@pa.gov with the following information:

• Your full name
• Federal EIN, Revenue ID, or SSN
• Your mailing address
• Phone number
• Number of months you are requesting
• If you don’t hear back within 48 hours, please check your spam and/or junk folder.
• Call 717-425-2495, Ext: PAYPA (72972). Have your checking account number and bank routing number available.

You could also make the tax payment process easier on yourself. DAVO automatically pays sales tax on your business’s behalf using funds already set aside. Less hassle, less worry, and less risk of missed deadlines.

Pennsylvania sales tax due dates

All sales tax accounts for new business licensees are initially established to file and pay sales tax on a quarterly basis. 

Every November, the Department runs a filing frequency change program for all active accounts. The sales tax account filing frequency for the next calendar year may or may not change based upon the amount of sales tax reported to the Department.

If a due date falls on a weekend or holiday, the deadline is typically the next business day.

You can submit a request to change your filingand/or payment frequency for sales and withholding taxes.

If you’re required to make accelerated sales tax (AST) prepayments, remit a separate payment by the 20th of the current month. For a schedule of return and prepayment due dates, review REV-819.

Pennsylvania vendor discount

Businesses that file and pay on time may qualify for a vendor compensation discount. 

• Monthly filers: $25.00 per sales tax return or the 1% discount, whichever is less.
• Quarterly filers: $75.00 per sales tax return or the 1% discount, whichever is less
• Semi-Annual filers: $150.00 per sales tax return or the 1% discount, whichever is less

If you operate in other states, it might help to see where vendor discounts are available. DAVO returns this collection allowance to the business in full, which in many cases offsets the entire subscription cost.

What is the Pennsylvania sales tax late payment penalty?

Late-filed or late-paid returns may be subject to penalties and interest. Pennsylvania imposes a penalty for late-filed sales tax returns of 5% of the unpaid tax for each month, or fraction thereof, that the return is late, unless the taxpayer can prove reasonable cause for late filing. The maximum penalty is 25% of the unpaid or late-paid tax. The minimum penalty is $5.

In addition to the penalty fee, interest accrues daily from the tax due date to the date of actual payment. The PA Department of Revenue calculates the interest on taxes using an annual interest rate, using the following formula:

Late/unpaid tax x Number of days x Applicable daily interest rate = Interest

You can use the myPATH Penalty and Interest Calculator to get an estimate of what you may owe.

Staying current on filings, even during slow months, helps you avoid compounding costs.

How DAVO can help with Pennsylvania sales tax

Whether you operate a brick-and-mortar shop in Philadelphia, a Pittsburgh boutique, or a growing food truck business serving Scranton and beyond, Pennsylvania sales tax compliance requires consistent attention. Rate changes, location-based rules, and filing deadlines all add administrative weight to an already busy operation. 

DAVO removes that burden by automating collection, filing, and payment, guaranteed. That way, you can spend less time worrying about compliance and more time serving your customers with confidence.

Choose your POS system to get started with DAVO.

Pennsylvania Department of Revenue:

https://www.pa.gov/agencies/revenue

Department of Revenue Customer Service Center

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