The (Pottstown) Mercury, July 21
Montgomery County says it won’t collect sales tax for providing services
Margaret Gibbons
Special to The Mercury
Montgomery County may soon be known as a government of tax rebels.
In June, the county commissioners launched their own version of the Boston Tea Party by firing off a letter to the Pennsylvania Department of Revenue, advising it that the county has no intention of collecting the state’s 6 percent sales tax on goods and services provided by the county.
The battlefield for this tax revolution now will likely be the courts unless the state backs off, according to county Solicitor Michael D. Marino.
"If (the state) wants to try and get it, go ahead and try, but we don’t believe this is something that should be taxed," said commissioners’ Chairman Thomas J. Ellis. "It’s a form of double taxation. It’s a government service and this sales tax is just a way of nickel-and-diming people in Montgomery County and the Commonwealth for getting things that they need."
For example, he said, people are required by law to file their deeds and mortgages with the county recorder of deeds office and they pay a fee to file those documents. To turn around and charge that person a sales tax for a copy of that document is ridiculous, Ellis said.
It was county Recorder of Deeds Nancy Becker who first alerted the commissioners of the situation.
Becker was notified by the state Department of Revenue that, starting Jan. 1, 2007, her office would be required to charge and collect a 6 percent sales tax for copies on any documents filed in her office.
That office is required by law to provide copies of recorded documents to all requesters. The law allows her to charge a reasonable fee but bars her from making a profit.
While investigating the situation, the county learned that the state wants a sales tax collected on copies made by any county office, such as the prothonotary office where all civil litigation is filed and the clerk of courts office where criminal documents are filed.
Also subject to the sales tax, as far as the state is concerned, are marriage certificates, hunting and dog licenses and other services provided by the county, according to Marino.
State law requires vendors to collect a sales tax from purchasers, Marino said.
The state’s interpretation that this also includes counties and services that it provides "is dead wrong," said the solicitor.
A vendor, under the law, is a person who maintains a place of business, Marino said. Business means a commercial enterprise carried on for profit, he said.
"We are neither vendors nor are we a place of business," said Marino. "We are a place of government . . . and we are not in the business of making a profit."
"The whole premise of this is that they are comparing us to Kinko’s which, when you go, you bring something in to copy," said Becker. "When you come into a county office, it is the only place where something is filed."
The county is perfectly willing to collect a sales tax when it operates as a "vendor," said Marino. These situations include: renting boats at Green Lane Park, selling items in gift shops at Pottsgrove Manor or the county geriatric facility or even on items sold at the county’s cafeteria at the human services center in Norristown.
However, the commissioners are adamantly opposed to the collecting a sales tax on copies, marriage certificates and the like, said Marino.
"It’s not the money but the principle," said Ellis.
Ellis noted that the projected revenue for the impacted departments in this year’s county budget of about $448 million is $1.23 million, meaning that the county would have to charge and collect state sales tax in the amount of $74,028 if the sales tax requirement was in effect for this year.
Montgomery County is the first county to step forward in opposing the state revenue department’s proposal, according to the commissioners. However, the state associations for both the recorders of deeds and treasurers have gone on record as also opposing the measure.
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