Pennsylvania Utility Sales Tax Exemption
Pennsylvania provides a sales tax exemption on electricity, steam, natural gas, and manufactured gas when used directly in the manufacturing, processing, farming, dairying, horticulture, floriculture, or public utility service operations. The exemption applies for utilities used directly in manufacturing or processing.
Utility Study Requirements
A utility usage study is required for al use meters to determine the portion of utilities used directly in manufacturing or processing activities. The study should:
- Identify all utility-consuming equipment.
- Document usage amounts for each item.
- Separate exempt from non-exempt usage based on function.
- Support the exempt percentage determined per meter.
Exemption Requirement
Submit form REV-1220, Pennsylvania Sales Tax Exemption Certificate to utility providers, specifying the applicable exemption category to support your claim. Refunds on utility sales taxes must be filed with the Pennsylvania Department of Revenue or through the utility provider. Refund claims can generally be made for up to three years of overpaid tax and must be supported by records such as utility bills, usage studies, and exemption certificates.