PRINTER'S NO. 968
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
162
Session of
2023
INTRODUCED BY R. MACKENZIE, KAUFER, FLOOD, GILLEN, STRUZZI,
ADAMS, GUENST, KAUFFMAN, M. MACKENZIE, MARCELL, E. NELSON,
OWLETT, PICKETT AND RADER, APRIL 24, 2023
REFERRED TO COMMITTEE ON FINANCE, APRIL 24, 2023
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," in gross receipts tax, further providing for
imposition of tax.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 1101(b), (c), (e), (g) and (h) of the act
of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971, are amended to read:
Section 1101. Imposition of Tax.--* * *
[(b) Electric Light, Waterpower and Hydro-electric
Utilities.--Every electric light company, waterpower company and
hydro-electric company now or hereafter incorporated or
organized by or under any law of this Commonwealth, or now or
hereafter organized or incorporated by any other state or by the
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
United States or any foreign government and doing business in
this Commonwealth, and every limited partnership, association,
joint-stock association, copartnership, person or persons,
engaged in electric light and power business, waterpower
business and hydro-electric business in this Commonwealth, shall
pay to the State Treasurer, through the Department of Revenue, a
tax of forty-four mills upon each dollar of the gross receipts
of the corporation, company or association, limited partnership,
joint-stock association, copartnership, person or persons,
received from:
(1) the sales of electric energy within this State, except
gross receipts derived from the sales for resale of electric
energy to persons, partnerships, associations, corporations or
political subdivisions subject to the tax imposed by this
subsection upon gross receipts derived from such resale; and
(2) the sales of electric energy produced in Pennsylvania
and made outside of Pennsylvania in a state that has taken
action since December 21, 1977 which results in higher costs for
electric energy produced in that state and sold in Pennsylvania
unless the action that was taken after December 21, 1977 is
rescinded according to the following apportionment formula:
except for gross receipts derived from sales under clause (1),
the gross receipts from all sales of electricity of the producer
shall be apportioned to the Commonwealth of Pennsylvania by the
ratio of the producer's operating and maintenance expenses in
Pennsylvania and depreciation attributable to property in
Pennsylvania to the producer's total operating and maintenance
expenses and depreciation.]
(c) Payment of Tax; Reports.--The said taxes imposed under
[subsections (a) and (b)] subsection (a) shall be paid within
20230HB0162PN0968 - 2 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
the time prescribed by law, and for the purpose of ascertaining
the amount of the same, it shall be the duty of the treasurer or
other proper officer of the said company, copartnership, limited
partnership, association, joint-stock association or
corporation, or person or persons, to transmit to the Department
of Revenue on or before March 15 of each year an annual report,
and under oath or affirmation, of the amount of gross receipts
of the said companies, copartnerships, corporations,
associations, joint-stock associations, limited partnerships,
person or persons, derived from all sources, and of gross
receipts from business done wholly within this State. [and in
the case of electric energy producers that transmit energy to
other states referred to in clause (2) of subsection (b), a
compilation of the relevant information regarding operating and
maintenance expenses and depreciation, during the period of
twelve months immediately preceding January 1 of each year.]
* * *
(e) Time to File Reports.--The time for filing annual
reports may be extended, estimated assessments may be made by
the Department of Revenue if reports are not filed, and the
penalties for failing to file reports and pay the taxes imposed
under subsection (a) [and (b)] shall be as prescribed by the
laws defining the powers and duties of the Department of
Revenue. In any case where the works of any corporation,
company, copartnership, association, joint-stock association,
limited partnership, person or persons are operated by another
corporation, company, copartnership, association, joint-stock
association, limited partnership, person or persons, the taxes
imposed under [subsections (a) and (b)] subsection (a) shall be
apportioned between the corporations, companies, copartnerships,
20230HB0162PN0968 - 3 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
associations, joint-stock associations, limited partnerships,
person or persons in accordance with the terms of their
respective leases or agreements, but for the payment of the said
taxes the Commonwealth shall first look to the corporation,
company, copartnership, association, joint-stock association,
limited partnership, person or persons operating the works, and
upon payment by the said company, corporation, copartnership,
association, joint-stock association, limited partnership,
person or persons of a tax upon the receipts, as herein
provided, derived from the operation thereof, no other
corporation, company, copartnership, association, joint-stock
association, limited partnership, person or persons shall be
held liable for any tax imposed under [subsections (a) and (b)]
subsection (a) upon the proportion of said receipts received by
said corporation, company, copartnership, association, joint-
stock association, limited partnership, person or persons for
the use of said works.
* * *
[(g) Certain Gross Receipts not Taxed.--The tax otherwise
imposed pursuant to this section upon gross receipts derived
from the sale of electricity shall not however be imposed upon
those portions of the gross receipts of an electric light
company attributable to the following sources:
(1) the net increase in its gross receipts resulting from
recovery from its customers of the costs of purchases of
additional energy necessitated by the physical or legal
inability to operate a nuclear generating facility as a result
of an accident or natural disaster causing material damage to
that facility or to a similar associated facility located
immediately adjacent, whereupon either the damaged facility,
20230HB0162PN0968 - 4 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
another located immediately adjacent, or both, have been removed
from the company's rate base for a period exceeding twenty-five
months. The Department of Revenue shall request the Public
Utility Commission to determine, for each such facility, the net
increase in the gross receipts of its electric company owner for
the immediate prior twelve-month period. This determination
shall reflect the difference between the increased gross
receipts of the company attributable to recovery of costs for
purchase of replacement energy which otherwise would have been
normally generated by the inoperative facility in such twelve-
month period less the reduction in the company's gross receipts
attributable to removal of the capital costs of the facility
from the company's rate base and less the reduction in the
company's gross receipts attributable to reduction in operating
expenses that would have otherwise been incurred by normal
operation of the facility in such twelve-month period. The
Public Utility Commission shall, immediately after supplying the
requested data, proceed to make the appropriate revision in the
State tax adjustment charge of the electric company;
(2) recovery from its customers of costs incurred in
connection with the clean-up and decontamination of a nuclear
generating facility which has experienced a major accident or
natural disaster and had been removed from the electric light
company's rate base; and
(3) recovery from its customers of costs for the
amortization of investments in a nuclear generating facility
whose removal from the rate base of an electric light company
has been approved by the Public Utility Commission on account of
a major accident or natural disaster.]
(h) Benefits to Consumer.--For purposes of this article, the
20230HB0162PN0968 - 5 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
reduction in the taxes imposed under [subsections (a) and (b)]
subsection (a) shall derive to the benefit of the consumer
purchasing services from said utilities. Said benefit shall be
provided in the form of a reduction in the State tax surcharge.
Failure to pass through the reduction to the consumer shall
subject the public utility to a civil penalty of at least one
thousand dollars ($1,000), but not more than five thousand
dollars ($5,000), and such additional relief as the court may
deem appropriate.
* * *
Section 2. The amendment of section 1101(b), (c), (e), (g)
and (h) of the act shall apply to gross receipts received on or
after January 1 of the first taxable year commencing after the
effective date of this section and each taxable year thereafter.
Section 3. This act shall take effect immediately.
20230HB0162PN0968 - 6 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15