HARRISBURG (March 9, 2017) Sen. Mike Regan (R-Cumberland and York) issued the following statement in response to the governor’s plan to remove the sales and use tax exemption for commercial storage.
Extending the state’s six percent sales tax to warehouses is a short-sighted, ill-advised tax on business that will have a detrimental effect on local employers, consumers, workers, the regional economy, and the state’s fragile fiscal recovery.
This tax plan will automatically put Pennsylvania at a competitive disadvantage with neighboring states, including Maryland, Ohio, New Jersey and New York, which do not levy a sales tax on warehousing.
The tax will force warehouse owners in Pennsylvania, and those considering doing business in Pennsylvania, to re-evaluate their operations. The result will be lost jobs, higher consumer costs, and an economy that continues to grow at an anemic pace.
We are blessed to have major employers such as Amazon in our midst, who are offering family-sustaining wages to so many Central Pennsylvanians and are solid corporate citizens and taxpayers.
The job-killing warehouse tax is especially troubling considering the nature of the industry. Because the supply chain process involves multiple states, companies can easily bypass the Commonwealth in favor of states with lower costs. Studies have shown that a tax on warehousing leads to a loss of warehouse- and transportation-related jobs and a net loss of millions of dollars in state tax revenue.
To build revenue, we must build jobs. The warehouse tax plan will do the opposite, driving out job creators, driving up costs, and eroding revenues and economic growth long-term.
CONTACT: Noah Karn (717) 787-8524
nkarn@pasen.gov