RULES AND REGULATIONS
Title 61—REVENUE
DEPARTMENT OF REVENUE
[ 61 PA. CODE CH. 53 ]
Clothing
[40 Pa.B. 1746]
[Saturday, April 3, 2010]The Department of Revenue (Department), under section 270 of the Tax Reform Code of 1971 (TRC) (72 P. S. § 7270), has amended 61 Pa. Code Chapter 53. ''Wearing Apparel,'' by renaming the chapter ''Clothing,'' amending definitions, conforming the regulation to the statute, clarifying examples and the scope in § 53.1 (relating to clothing) to read as set forth in Annex A.
Purpose of this Final-Form Rulemaking
This final-form rulemaking will conform to Pennsylvania law and avoid any confusion for taxpayers paying Sales and Use Taxes. In addition, the rulemaking codifies legislative changes relating to clothing patterns that were set forth in Act 23-2000 (See section 204(26) of the TRC 72 P. S. § 7204(26)).
Explanation of Regulatory Requirements
The major reason for this amendment is to bring the regulation into conformity with the statute. The current definition of ''wearing apparel'' in § 53.1(a)(7) when read in conjunction with § 53.1(b)(3) would appear to exempt from Sales and Use Tax the service of repairing, altering, mending, pressing, fitting, dyeing, laundering, drycleaning or cleaning of accessories, ornamental wear, formal day or evening apparel, fur articles and sporting goods and clothing. The statute in section 201(k)(4) and (o)(4) of the TRC (72 P. S. § 7201(k)(4) and (o)(4)) excludes from the definition of ''sale at retail'' and ''use'' the repairing, altering, mending, pressing, fitting, dyeing, laundering, drycleaning or cleaning of only wearing apparel or shoes. Although ''wearing apparel'' is not defined in the TRC, it is referred to in section 7204(26) of the TRC as a subset of clothing. That section provides an exemption from tax for ''all vesture, wearing apparel, raiments, garments, footwear and other articles of clothing . . . but all accessories, ornamental wear, formal day or evening apparel, and articles made of fur . . . and sporting goods and clothing not normally used or worn when not engaged in sports shall not be excluded from tax.'' This language clearly indicates that wearing apparel is clothing since wearing apparel is followed by ''and other articles of clothing.'' The language also indicates that accessories, ornamental wear, formal day or evening apparel, fur articles, sporting goods and sporting clothing are not clothing or wearing apparel and the sale or use of these items are taxable.
To bring the regulation into conformity with the statute, the ''definitions'' in § 53.1(a) have been amended. ''Clothing'' has been enhanced to mirror language in the statute in section 204(26) of the TRC. The definition for ''wearing apparel'' has been deleted.
The ''scope'' subsection has been amended in § 53.1(b) to remove language and insert clarifying language that mirrors language in the statute in sections 7201(k)(4) and (o)(4) and 7204(26) of the TRC. Language has been added in § 53.1(c) to clarify examples of accessories, ornamental wear, formal day or evening apparel, fur articles and sporting goods and sporting clothing. The word ''wearing apparel'' has been deleted from this subsection.
In subsection (d), the word ''patterns'' has been deleted to mirror the statute as a result of Act 23-2000.
Affected Parties
Taxpayers in this Commonwealth paying Sales and Use Tax may be affected by the regulation although it is believed that the repairers, alters, and the like, of accessories, ornamental wear, and the like, have been charging Sales Tax on these services.
Comment and Response Summary
Notice of proposed rulemaking was published at 39 Pa.B. 1209 (March 7, 2009). This proposed rulemaking is being adopted without amendments to read as set forth in Annex A.
The Department received one comment from the public during the public comment period. No comments were received from either the House Finance Committee or the Senate Finance Committee (Committees). The Independent Regulatory Review Commission (IRRC) submitted no comments on the proposed rulemaking.
No amendments have been made to the proposed rulemaking in response to the one public comment, as it was in support of the proposed rulemaking as published.
Fiscal Impact
The Department has determined that the final-form rulemaking will have minimal fiscal impact on the Commonwealth.
Paperwork
The final-form rulemaking will not create additional paperwork for the public or the Commonwealth.
Effectiveness/Sunset Date
The final-form rulemaking will become effective upon final publication in the Pennsylvania Bulletin. The regulation is scheduled for review within 5 years of final publication. No sunset date has been assigned.
Contact Person
The contact person for an explanation of the final-form rulemaking is Mary R. Sprunk, Office of Chief Counsel, Department of Revenue, Department 281061, Harrisburg, PA 17128-1061.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on February 20, 2009, the Department submitted a copy of the notice of proposed rulemaking, published at 39 Pa.B. 1209, to IRRC and to the Committees for review and comment.
Under section 5(c) of the Regulatory Review Act, IRRC and the Committees were provided with copies of the comment received during the public comment period, as well as other documents when requested. In preparing the final-form rulemaking, the Department has considered the one comment from the public.
Under section 5.1(j.2) of the Regulatory Review Act (71 P. S. § 745.5a(j.2)), on February 24, 2010, the final-form rulemaking was deemed approved by the Committees. Under section 5(g) of the Regulatory Review Act, the final-form rulemaking was deemed approved by IRCC, effective February 24, 2010.
Findings
The Department finds that:
(1) Public notice of intention to amend the regulation has been given under sections 201 and 202 of the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. §§ 1201 and 1202) and the regulations thereunder, 1 Pa. Code §§ 7.1 and 7.2.
(2) The amendment is necessary and appropriate for the administration and enforcement of the authorizing statute.
Order
The Department, acting under the authorizing statute, orders that:
(a) The regulations of the Department, 61 Pa. Code Chapter 53, are amended by amending § 53.1 to read as set forth in Annex A.
(b) The Secretary of the Department shall submit this order and Annex A to the Office of General Counsel and the Office of Attorney General for approval as to form and legality as required by law.
(c) The Secretary of the Department shall certify this order and Annex A and deposit them with the Legislative Reference Bureau as required by law.
(d) This order shall take effect upon publication in the Pennsylvania Bulletin.
C. DANIEL HASSELL,
Acting Secretary(Editor's Note: For the text of the order of the Independent Regulatory Review Commission relating to this document, see 40 Pa.B. 1471 (March 13, 2010).)
Fiscal Note: Fiscal Note 15-446(F) remains valid for the final adoption of the subject regulation.
Annex A
TITLE 61. REVENUE
PART I. DEPARTMENT OF REVENUE
Subpart B. GENERAL FUND REVENUES
ARTICLE II. SALES AND USE TAX
CHAPTER 53. CLOTHING § 53.1. Clothing.
(a) Definitions. The following words and terms, when used in this chapter, have the following meanings, unless the context clearly indicates otherwise:
Accessories—Articles, other than clothing, which are designed to be worn on or about the human body.
Clothing—Articles, including vesture, wearing apparel, raiments, garments or shoes, which are designed to cover the human body as ordinary or everyday wear.
Formal day or evening apparel—Articles worn or carried on or about the human body which are designed for formal functions and not normally worn except while attending a formal function.
Fur articles—Articles worn or carried on or about the human body which are made of:
(i) Fur on the hide or pelt.
(ii) Material imitative of fur.
(iii) Combination of fur, real, imitative or synthetic, and other material provided the fur, real, imitative or synthetic, is more than three times the value of the next most valuable material.
Ornamental wear—Articles, other than clothing, which are designed and normally worn for decorative purposes.
Sporting goods and sporting clothing—Articles worn or carried on or about the human body which are designed for sporting activity and not normally worn except while engaged in sports.
(b) Scope. This section applies to the following transactions:
(1) The sale or use of clothing is not subject to tax.
(2) The sale or use of accessories, ornamental wear, formal day or evening apparel, fur articles and sporting goods and sporting clothing shall be subject to tax unless the purchaser is entitled to claim an exemption under the law.
(3) A charge for the service of repairing, altering, mending, pressing, fitting, dyeing, laundering, drycleaning or cleaning shoes of any type or clothing is not subject to tax with the exception of the imprinting or printing of clothing belonging to others.
(4) A charge for the service of repairing, altering, mending, pressing, fitting, dyeing, laundering, drycleaning or cleaning accessories, ornamental wear, formal day or evening apparel, fur articles or sporting goods and sporting clothing, except for shoes of any type shall be subject to tax unless the purchaser is entitled to claim an exemption under the law.
(c) Examples. The following are examples of accessories, ornamental wear, formal day or evening apparel, fur articles and sporting goods and sporting clothing:
(1) Accessories Accessories include the following:
(i) Handbags, pocket books and purses.
(ii) Wallets and billfolds.
(iii) Umbrellas.
(iv) Jewelry, including jewelry with religious symbols, pins, cufflinks, and the like.
(v) Earring backs and covered buttons for making earrings and brooches.
(vi) Hair nets, hairpins, barrettes, curlers, hair clips, chignons and bandeaus.
(vii) Wigs and toupees.
(2) Formal men's day and evening apparel. Formal men's day and evening apparel includes the following:
(i) Tuxedos.
(ii) Dinner jackets.
(iii) Tail coats.
(iv) Cummerbunds.
(v) Striped formal trousers.
(vi) Opera capes.
(vii) Formal vests.
(viii) Cutaway coats.
(ix) Formal ties including ascots.
(x) White leather and silk gloves.
(xi) White formal suspenders.
(xii) Wing collars.
(xiii) Silk hats.
(iv) Opera hats.
(xv) Derby hats.
(3) Formal women's day and evening apparel. Formal women's day and evening apparel includes the following:
(i) Headpieces of the tiara type.
(ii) Kid or suede gloves, 16 button type.
(iii) Shoes for formal wear such as metallic cloth, brocade and satin.
(iv) Bridal apparel.
(4) Sporting goods and sporting clothing. Sporting goods and sporting clothing includes the following:
(i) Athletic supporters.
(ii) Team or individual uniforms, for example: football, baseball, basketball, hockey and soccer.
(iii) Shoes designed for particular sports, for example: football, baseball, soccer and track spikes; motorcross boots; ski boots; ice skates; wrestling shoes; swim fins; golf shoes; and bowling shoes.
(iv) Uniform socks, single-strap-under-a-foot-type.
(v) Weightlifting belts.
(vi) Protective equipment, for example: shoulder, knee, thigh, elbow, forearm, hand and rib pads used in football and other contact sports; mouthpieces; football and other sports helmets; cups for athletic supporters; and boxing headgear.
(vii) Gloves, for example: baseball, handball, hockey, batting and golf.
(viii) Hunting and fishing accessories, ammunition belts, hip waders and fly vests.
(ix) Bathing suits and caps.
(5) Fur articles. Fur articles include the following:
(i) Articles made of rabbit fur dyed to resemble mink.
(ii) Articles made of sheepskin with wool or hair attached thereto.
(iii) Articles made of fabrics made with vegetable, mineral or synthetic fibers which resemble fur in appearance.
(iv) Articles made of woven animal hair or wool which resembles fur in appearance.
(v) Articles with fur trim if the value of the fur trim is three times the value of the next most valuable component part.
(6) Ornamental wear. Ornamental wear includes the following:
(i) Costumes.
(ii) Corsages.
(iii) Hats, sashes, emblems, insignias, medallions, and the like, designed and normally worn in conjunction with club, organization, fraternity and similar ceremonies.
(d) Materials to be incorporated in clothing. The sale of items such as fabrics, thread, knitting yarn, buttons, snaps and zippers, to be incorporated into clothing is not subject to tax. The sale of property such as needles, dress forms, scissors and thimbles, is subject to tax unless the purchaser is engaged in the business of manufacturing or of purchasing the items for resale.
[Pa.B. Doc. No. 10-592. Filed for public inspection April 2, 2010, 9:00 a.m.]
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