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Pennsylvania letter ruling declares information retrieval subject to sales tax

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Recently, the Pennsylvania Department of Revenue issued Letter Ruling SUT-17-002, concluding that sales of information retrieval products accessed electronically are subject to Pennsylvania sales and use tax as sales of tangible personal property. This ruling marks the second Department-issued guidance this year involving its interpretation of the expanded tangible personal property definition under Act 84 of 2016, which now includes canned computer software and other digital products. In the letter ruling, the Department determined that a vendor’s sales of subscription-based online research services are taxable because the vendor’s subscribers exercise a license to access canned software, and because the content itself constitutes tangible personal property under Pennsylvania law.