The Pennsylvania sales tax rate is 6% statewide, with two local add-ons: Allegheny County brings the combined rate to 7%, and Philadelphia brings it to 8%. The rate that applies to a given purchase depends on where the sale takes place or where the goods are delivered.
Where the 7% and 8% Rates Apply
Only two jurisdictions in the Commonwealth add a local sales tax on top of the 6% state rate. Allegheny County imposes a 1% local tax for a combined 7%, with the local portion funding the Allegheny Regional Asset District that supports parks, libraries, and cultural institutions. Philadelphia imposes a 2% local tax for a combined 8%.1Pennsylvania Department of Revenue. Use Tax Everywhere else in Pennsylvania, you pay the flat 6%.
The state collects both local surtaxes along with the state portion and distributes the revenue back. For online orders, the seller should charge the combined rate for the delivery address. If you have a package shipped to a Philadelphia home, the correct rate is 8%, not 6%.
What’s Taxable at These Rates
Pennsylvania applies the 6% rate (plus any local surtax) to the retail sale or use of tangible personal property and to a specific list of services.2Department of Revenue. Sales, Use and Hotel Occupancy Tax Most tangible goods are covered: electronics, furniture, appliances, motor vehicles, and less obvious items like candy, gum, and non-prescription drugs.
Services work differently in Pennsylvania than in many other states. Rather than taxing services broadly, the legislature taxes only those it has individually named. The enumerated taxable services include:3Pennsylvania General Assembly. Pennsylvania Code 72 PS 7201 – Definitions
- Vehicle washing, waxing, polishing, lubricating, and state inspections
- Repair, alteration, or cleaning of tangible personal property other than clothing and shoes
- Lobbying services
- Secretarial and editing services, including typing, word processing, proofreading, and resume writing
- Pest control and building cleaning
- Employment agency and staffing services
- Lawn care and self-storage
- Printing and imprinting
If a service isn’t on the list, it generally isn’t taxable.
Digital Products
Since Act 84 of 2016, Pennsylvania has taxed digital products delivered electronically at the same 6% rate as physical goods. That covers e-books, streaming video subscriptions like Netflix and Hulu, music downloads and streaming audio, apps and games, and digital photographs.4Department of Revenue. Digital Products If you pay for it and receive it electronically, it’s taxable.
What’s Exempt
Pennsylvania exempts several broad categories of everyday goods, which is why the sticker price often equals what you pay at the register.
Clothing and Footwear
Most everyday clothing is sold tax-free in Pennsylvania. Shirts, pants, coats, dresses, and underwear are exempt, and so is ordinary footwear like sneakers, work boots, and dress shoes.5Pennsylvania Code and Bulletin. Pennsylvania Code 61 Chapter 53 – Clothing The exemption does not cover formal wear accessories, sports-specific footwear such as golf shoes, ski boots, or cleats, or items like fur coats that the state classifies separately.
Groceries and Medicine
Groceries bought for home consumption are not taxed. Produce, meat, dairy, bread, and other unprepared food fall outside the sales tax. Prepared food is different: restaurant meals, deli takeout, and catering are taxable. The line between grocery and prepared food trips people up more than any other exemption in the code.
Prescription medications and most medical supplies are also exempt. Over-the-counter drugs are generally taxable unless specifically listed among the exempt items.
Manufacturing and Resale
Businesses that manufacture or process goods in Pennsylvania can buy equipment, machinery, and supplies used directly in production without paying sales tax, provided those items are used more than 50% of the time in manufacturing operations. Raw materials that physically become part of the finished product qualify as purchases for resale and can be bought tax-free with a properly executed exemption certificate.6Pennsylvania Code and Bulletin. Pennsylvania Code 61 Section 32.32 – Manufacturing and Processing Any business buying goods for resale can also purchase them tax-free by presenting a valid Pennsylvania exemption certificate.
Use Tax When the Seller Didn’t Charge Pennsylvania Tax
Use tax fills the gap when you buy something from an out-of-state seller that didn’t collect Pennsylvania tax. The rate is identical to the sales tax: 6% statewide, 7% for items used in Allegheny County, and 8% for items used in Philadelphia.1Pennsylvania Department of Revenue. Use Tax Buy furniture from a retailer in a state with no sales tax and ship it to your Pennsylvania home, and you’re legally required to report and pay the use tax yourself.
Most major online retailers now collect Pennsylvania sales tax automatically. For purchases from smaller sellers, cross-border yard sales, or items brought back from travel, the obligation falls on you. Individuals can report use tax on their annual PA-40 income tax return.
Hotel Stays Are Taxed Separately
The general sales tax rate does not govern the full tax on a hotel room. Pennsylvania imposes a separate 6% hotel occupancy tax on room rentals at hotels, motels, inns, and similar accommodations, with proceeds directed to the state’s Tourism Promotion Fund.7New York Codes, Rules and Regulations. Pennsylvania Code 72 PS 7210 – Imposition of Tax Counties and municipalities may add their own lodging taxes, and in Allegheny County and Philadelphia the 1% and 2% local sales tax surtaxes also apply to hotel stays. The bill from a Philadelphia hotel will often reflect several stacked charges rather than a single 8% line.
Rates and Rules for Sellers
A business that sells taxable goods or services anywhere in Pennsylvania must hold a Sales, Use, and Hotel Occupancy Tax License. The license is free, renews automatically every five years, and must be displayed at each location.8Pennsylvania Department of Revenue. State and Local Sales, Use, and Hotel Occupancy Tax Charge 6% at the register for sales inside most of the state, 7% in Allegheny County, and 8% in Philadelphia.
Out-of-state sellers face the same rate schedule once they cross the economic nexus threshold of $100,000 in annual gross sales to Pennsylvania customers.9Department of Revenue. Online Retailers Pennsylvania uses a sales-dollar threshold only, with no separate transaction-count trigger. Marketplace facilitators such as Amazon, eBay, and Etsy collect and remit the tax on sales made through their platforms, a rule that took effect on April 1, 2018. If you sell through one of those platforms, the platform handles the Pennsylvania tax on those orders, though you remain responsible for tax on any direct sales you make outside the marketplace.