Perkasie Olde Towne Association

By Chuck Ozeck CPA

On February 9, Gov. Ed Rendell gave his eighth and final budget address to a joint session of the state House and Senate. The budget in its entirety, as well as the transcript of the governor’s budget address and other documents, can be found on the administration’s Office of the Budget website.

The governor proposes state spending in FY 2010-11 increase to $29.03 billion. (An increase of $1.15 billion, or 4.1 percent, over the current 2009-10 budget.)

Chief among the governor’s budget proposal is the creation of a Stimulus Transition Reserve Fund. This is a holding fund in which the state would deposit certain “new” revenues. These “new” revenues will be generated by proposed changes to the Tax Code. Some of these changes are listed below. NOTE: Look at how these changes have a DIRECT impact on you, your business, your clients, and your customers:

• Eliminating 71 exemptions to the Sales and Use Tax, including a sales tax on professional/accounting services, while reducing the overall sales tax from 6 percent to 4 percent. Below is the list of 71 exemptions he proposes eliminating. Eliminating exemptions means assessing sales tax on 71 products/services that currently are exempt from state sales tax
• Eliminating the Vendor Sales Tax Discount for businesses remitting timely tax payments.
• Implementing a severance tax on Marcellus Shale natural gas (5 percent of the gas value at the wellhead, plus 4.7 cents per 1,000 cubic feet extracted)
• Including other tobacco products among taxable items for sales tax purposes.
• Reducing the Corporate Net Income (CNI) tax from 9.99 percent to 8.99 percent.
• Continuing the phase-out of the Capital Stock and Franchise Tax (CSFT)

Again, I emphasize, this is a PROPOSAL. However, the impact of this legislation is so sweeping you need to know about this now. If you are so inclined, tell your local representative(s) what you think and how this may impact you and your business.

Chuck Ozeck
cjo@ozeck.com
Charles J. Ozeck, CPA
601 West Callowhill Street
Perkasie, PA 18944
Phone 215-453-8319

Below is a list provided by the Governor’s Budget Office of the 74 sales tax exemptions to be repealed by Gov. Rendell’s proposed 2010-11 budget.

Accounting, auditing and bookkeeping services; Attorney services
Administrative services
Advertising, public relations & related services
Air transportation
Airline Catering
All other professional and technical services
Amusement & recreation industries
Architectural, engineering, & related services

Bad Debts
Basic television

Call Center Credit
Candy and Gum
Caskets and Burial Vaults
Catalogs and Direct Mail Advertising
Charges for Returnable Containers
Coal
Coin Operated Food and Beverage Vending Machines
Commercial Vessels (Construction & Repair)
Commercial Vessels (Equipment, Maintenance)
Common Carriers
Construction of Memorials
Consulting (scientific, environmental, & technical)
Custom programming, design & data processing

Dry-cleaning & laundry services

Electric – Residential
Electrical, plumbing, heating & AC service fees

Financial Institutions Fees
Firewood
Fish Feed
Flags
Fuel Oil/Gas – Residential
Funeral parlors, crematories & death care services

Gratuities

Helicopters
Horses Sold To Out of State Purchasers
Hotel-Permanent Resident

Information services
Investment Metal Bullion & Investment Coins

Legal
Liquor or Malt Beverage Purchased From Retail Dispenser

Magazines
Mfg. Exemption (Public Utility)
Motor Vehicles (Out-of-State Purchases)
Museums, historical sites, zoos, & parks For-Profit

Newspapers
Non-Prescription Drugs

Other transportation
Other: personal services

Parking lots & garages
Personal care services
Personal Hygiene Products

Rail Transportation Equipment
Recreational parks, camps & campgrounds
Rental of Films for Commercial Exhibition

School Buses
Scientific research & development services
Services to Buildings and Dwellings
Specialized design
Spectator sports admissions (excludes schools)
Stair Lift Devices

Telephone – Residential
Temporary Usage
Textbooks
Theater, dance, music & performing arts admissions For-Profit
Tourist Promotion Agencies
Transit & ground transportation
Trout
Truck transportation

Uniform Commercial Code Filing Fees

Veterinary fees

Warehouse Storage
Waste management and remediation services
Water and Sewage Services
Wrapping and Packing Supplies

Chuck Ozeck is a Certified Public Accountant, consultant and Certified QuickBooks Pro Advisor. He established his own firm in 1991 following a career in public accounting and Fortune 500 companies including Big 4 CPA firm, SE-Pa Regional CPA firm; Exxon Corp. (QYX & Exxon Office Systems Company); Greyhound Corp. (Armour Handcrafts, Armour-Dial Corp.). Chuck earned a Bachelor of Science degree in Accounting from the Villanova University Business School.

Filed under: Uncategorized on February 21st, 2010