Effective October 1, 1991, the sale at retail or use of employment service services undergoes tax. (1) An employe reporting to operate at an area in this Commonwealth is subject to tax. (2) An employe reporting to work at an area beyond this Commonwealth is exempt to tax, unless the employe is assigned to work in this Commonwealth. (3) If the employe is situated in this Commonwealth, it is presumed that the employment firm service goes through tax unless paperwork supports the reporting to a location outside of this Commonwealth. (c) Examples of taxable services. The following are examples of taxable employment service services: (1) A Pennsylvania resident contacts a Pennsylvania supplier and is positioned with a company at an area in this Commonwealth. (2) A Pennsylvania resident contacts an Ohio supplier and is put with a company at a location in this Commonwealth. (3) A Pennsylvania employer contacts a supplier outside this Commonwealth and accepts an employe for its location in this Commonwealth. (4) A New york city resident contacts a New york city vendor and is placed with a company at a place in this Commonwealth. (5) A Pennsylvania vendor paid on a hourly rate interviews and suggests a potential employe to a company. (d) Examples of services which are not work agency services. The following are examples of services which are not employment firm services: (1) A Pennsylvania resident contacts a Pennsylvania supplier and is placed with a company at an area outside of this Commonwealth. (2) A Pennsylvania resident contacts a New york city supplier and is placed with an employer in New Jersey. (3) A New york city resident contacts a Pennsylvania supplier and is placed with a company at an area in New york city. (4) A Pennsylvania employer contacts a vendor beyond this Commonwealth and accepts an employe for its out-of-State place. (e) Purchase cost. (1) Effective October 1, 1991, through December 31, 1991, the purchase rate of employment service services subject to tax is the gross cost. (2) Effective January 1, 1992, the purchase cost of employment service services subject to tax is the service charge if the employe costs are individually specified; otherwise, the gross cost undergoes tax. (3) If the purchase rate is canceled or renegotiated, tax is due on the adjusted purchase price. If a change to the tax occurs, the supplier is allowed to offset the change versus present tax liabilities. (4) If the purchase rate is paid on an installment basis, the tax is due on the complete purchase rate and is payable at the time the purchaser accepts the agreement or within 30 days of acceptance of the contract. (f) Exclusions. (1) Employment service services are exempt if purchased by certified charitable companies, volunteer fire companies, religious organizations and nonprofit educational organizations, other than if used in an unassociated trade or organization. The services are likewise exempt if acquired by the Federal federal government or its instrumentalities; or the Commonwealth, its instrumentalities or subdivisions consisting of public school districts. The manufacturing, mining, processing, public energy, farming, dairying, agriculture, cultivation or floriculture exclusion does not apply. (2) Employment services offered by theatrical employment firms or movie casting bureaus. (3) Farm labor. (4) A supplier of employment service services might claim the resale exemption upon its purchase of concrete personal residential or commercial property which is transferred to its buyer or a 3rd party in the efficiency of its work company services. The supplier may also acquire work agency services from another provider which the vendor resells to its consumer. The supplier might not claim the resale exemption upon its purchase of administrative materials or the purchase of another taxable service which it might use in the efficiency of its work agency services.
Source

The arrangements of this § 60.5 adopted January 8, 1993, effective January 9, 1993, 23 Pa. B. 182.

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