Warehouse Group Fights Tax

Warehouse Group Fights Tax

A proposed 4 percent tax on warehouse services in Pennsylvania would kill local jobs, says International Warehouse Logistics Association President Joel D. Anderson.

“A 4 percent increase in transport and storage costs in and out of Pennsylvania is bad for jobs and bad for tax collections,” Anderson said in a letter to Gov. Edward G. Rendell.

The tax is part of a package Rendell proposed to shrink the state’s $5.6 billion deficit. The governor wants to reduce Pennsylvania’s sales tax from 6 percent to 4 percent and extend it to a list of 74 products and services that aren’t taxed, including warehousing.

Instead of raising revenue, the tax would drive warehouse jobs and freight to neighboring states, Anderson said.

“Our customers will not tolerate a 4 percent increase to do business in Pennsylvania when they can easily go across the border to Maryland, Ohio, New York or New Jersey and utilize the services of a competitor warehouse not subject to this tax,” he said.

“Warehouse firms and their customers will sharply reduce Pennsylvania operations.”

Anderson cited a 2007 Michigan State University study that led to the repeal of a warehouse services tax in Michigan. The study found the tax would lead to the loss of several thousand warehousing and transportation jobs and millions of dollars in tax revenue.

Contact William B. Cassidy at wcassidy@joc.com.