State Taxes in Pennsylvania
The Pennsylvania (PA) state sales tax rate is currently 6%. Total tax rates range from 6% to 8% depending on the local municipality. Anyone making retail sales of goods or services in Pennsylvania must collect and remit sales tax.
Goods subject to sales tax in Pennsylvania include physical property like furniture, appliances, and vehicles. Prescription and non-prescription medicine, most groceries, gasoline, and clothing are exempt from sales tax. Some services in Pennsylvania are taxable.
Income Tax
Pennsylvania has a flat income tax rate of 3.07%. This is the lowest flat tax rate of any state with an income tax. Some deductions and credits are available to reduce income tax liability, such as deductions for medical and health savings accounts contributions and 529 college savings plan contributions. There is also a tax credit for taxes paid to another state.
The deadline for filing Pennsylvania income tax returns is April 15. Marginal and effective tax rates apply to income. A single taxpayer with $70,000 of taxable income has an estimated income tax of $2,149.
Additional Local Taxes
Two counties charge an additional 1-2% sales tax on top of the 6% state sales tax rate. Local jurisdictions can also impose additional sales taxes.
Local jurisdictions impose property and wage taxes. Pennsylvania property tax rates are higher than national averages. Philadelphia has separate wage tax rates for residents and non-residents. Gas tax ranked highest in the country in 2022.
Tax Climate Comparison
Pennsylvania provides a tax-friendly climate for retirees but ranked among the 15 least tax-friendly states for small businesses. The overall tax burden is fairly high, with the cost of living 4.2% above the national average.