Legislation recently advanced by the State Senate Finance Committee would provide small businesses with tax relief.
Senate Bill 473 would restore the Sales and Use Tax Vendor Discount by lifting the $300 per month cap on the discount businesses receive for the timely collection and remittance of state sales tax to allow businesses to receive the full 1 percent discount.
Businesses were permitted prior to 2016 to receive a vendor discount equal to 1 percent of the amount collected without a cap. Removing the cap would help offset the costs associated with compliance such as bookkeeping, transaction fees, and payment processing costs.
“Small businesses serve as the backbone of our local communities, and they should not be penalized for doing the state’s work in collecting and remitting sales tax,” state Sen. Kristin Phillips-Hill (R-York), the bill’s sponsor, said. “This legislation restores fairness and ensures we provide real relief to small businesses that have faced enormous cost pressures, especially since the COVID-19 pandemic.
“Increasing costs for fuel, labor, rent, and supplies continue to strain small businesses across the commonwealth. This legislation sends a strong message that Pennsylvania values our small businesses and wants to remain competitive with neighboring states.”
The bill moves to the full Senate for consideration.