HB 2523 — An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in sales and use tax, further providing for exclusions from tax.

PRINTER'S NO.   3416

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 2523
                                               Session of
                                                 2026

     INTRODUCED BY FLOOD, KUTZ, LEADBETER, M. MACKENZIE, MARCELL,
        OLSOMMER, PUGH, ROWE, SMITH, STENDER AND WEAKNECHT,
        MAY 15, 2026

     REFERRED TO COMMITTEE ON FINANCE, MAY 20, 2026


                                    AN ACT
 1   Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
 2      act relating to tax reform and State taxation by codifying
 3      and enumerating certain subjects of taxation and imposing
 4      taxes thereon; providing procedures for the payment,
 5      collection, administration and enforcement thereof; providing
 6      for tax credits in certain cases; conferring powers and
 7      imposing duties upon the Department of Revenue, certain
 8      employers, fiduciaries, individuals, persons, corporations
 9      and other entities; prescribing crimes, offenses and
10      penalties," in sales and use tax, further providing for
11      exclusions from tax.
12      The General Assembly of the Commonwealth of Pennsylvania
13   hereby enacts as follows:
14      Section 1.    Section 204 of the act of March 4, 1971 (P.L.6,
15   No.2), known as the Tax Reform Code of 1971, is amended by
16   adding a clause to read:
17      Section 204.    Exclusions from Tax.--The tax imposed by
18   section 202 shall not be imposed upon any of the following:
19      * * *
20      (77)    The sale at retail or use of school supplies during the
21   exclusion period to an individual purchaser for educational
22   purposes. The department shall publish a notice on the publicly
 1   accessible Internet website of the department to provide
 2   guidance on the implementation of the exclusion under this
 3   clause. For the purposes of this clause, the following terms or
 4   phrases shall have the following meanings:
 5      "Art supplies" shall mean clay and glazes, paints,
 6   paintbrushes, sketch and drawing pads and watercolors.
 7      "Exclusion period" shall mean the three-month period between
 8   July 1, 2026, and September 30, 2026, and between each July 1
 9   and the succeeding September 30 thereafter.
10      "Instructional materials" shall mean reference books,
11   reference maps and globes, textbooks and workbooks.
12      "Purchaser" shall mean an individual who places an order and
13   pays the purchase price by cash or credit during the exclusion
14   period, even if delivery takes place after the exclusion period.
15      "School supplies" shall mean items such as book bags, pens,
16   pencils, pencil sharpeners, markers, highlighters, erasers,
17   crayons, blackboard chalk, notebooks, binders, folders, paper,
18   index cards, glue, tape, rulers, scissors, staplers, staples,
19   paper clips, printer ink, calculators, compasses, protractors,
20   lunch boxes, school supply boxes, personal organizers, art
21   supplies, clipboards, dry erase markers, sticky notes, bulletin
22   board paper, educational posters, games and instructional
23   materials with a sales price of fifty dollars ($50) or less per
24   item.
25      Section 2.   This act shall take effect immediately.




20260HB2523PN3416                  - 2 -