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Supply Chain Challenges, KANE Company News

Call to Action...Operators in Pennsylvania

Alex Stark | February 24, 2010

In Governor Rendell's proposed 2010-2011 budget for the state of Pennsylvania, he recommends reducing the state sales tax from 6% to 4%.  That could be good news for those of us who live in PA.

Here's the bad news.  As part of the decrease, Gov. Rendell plans to eliminate 74 tax exemptions currently in place.  For the vast majority of items, cigars, dry cleaning, personal hygiene products, the effect might be minimal. 

However, on that list of items is warehousing services.

This tax would negatively affect warehousing and certainly drive logistics/supply chain business away from Pennsylvania.  Neighboring states (New York, New Jersey, Maryland, Ohio) would benefit by not having to charge this tax for the warehousing services they provide.  Pennsylvania operations would be at a competitive disadvantage.

The end result will be lost jobs in PA.

In 2007, Michigan proposed and passed a similar measure.  The IWLA (International Warehouse Logistics Association) led the charge to protect the industry.  The IWLA pointed to a study published in November 2007 by Michigan State University which investigated the impact of such a tax.  The MSU study demonstrated that the loss of business and jobs would be the result of the tax. 

The new tax was quickly repealed.

We need the same result for Gov. Rendell's tax proposal on warehouse services.  If this tax proposal effects you or a loved one, please take the time to contact Gov. Rendell's office.