Court Opinion

ID: 9713145
Source: CourtListenerOpinion
Date Created: 2023-08-26 05:09:18.527226+00
Date Added: 2024-06-11T18:23:16.930066
License: Public Domain

DISSENTING OPINION BY
President Judge COLINS.
I dissent. The renewal of a license to use canned computer software is not subject to sales tax under the explicit terms of the Tax Reform Code of 1971 (Code).1
Sales tax is imposed on the sale at retail of tangible personal property or services. Section 202(a), 72 P.S. § 7202(a). “Sale at retail” encompasses the transfer for consideration of the ownership, custody or possession of tangible personal property, including the grant of a license to use or consume tangible personal property. Section 20100(1), 72 P.S. § 720100(1). “Tangible personal property” is
corporeal personal property including, but not limited to, goods, merchandise, steam and natural and manufactured and bottled gas for non-residential use, electricity for non-residential use, prepaid telecommunications, premium cable or premium video programming service, spirituous or vinous liquor and malt or brewed beverages and soft drinks, interstate telecommunications service ... and charged to a service address in this Commonwealth, intrastate telecommunications service....
Section 201(m), 72 P.S. § 7201(m). Exclusions from imposition of the sales tax include the sale at retail of personal computers and single-user licensed software purchased with a personal computer; the exclusion does not include the sale at retail of multiple-user licensed software.
The multiple-user license renewals at issue in the present case fall outside the statutory definition of tangible personal property, and absent a change in the statutory definition of tangible personal property, the Commonwealth may not by regulation, or policy statement, impose the sales on the renewal of multiple-user software licenses. I see no reason to consult the tax practice and policy of other states. By the statute’s explicit terms, the renewal of multiple-user licenses to use canned computer software is not a transfer of tangible personal property or a license to use tangible personal property.

. Act of March 4, 1971, P.L. 6, as amended, 72 P.S. §§ 7101-8297. P.L. 6, as amended, 72 P.S. §§ 7101-8297.