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Large Retailers No State Tax Due on Face Masks Pennsylvania Class Action

This class action brings suit against a variety of businesses operating in Pennsylvania, including Walmart, Inc. and the Home Depot, Inc. for charging sales tax on face masks. The complaint alleges that masks are exempt at the moment from Pennsylvania state sales tax, and claims that the companies who have been collecting it from consumers have been violating the state’s Unfair Trade Practices and Consumer Protection Law (UTPCPL).

The defendants in this case, besides Walmart and Home Depot, include Big Lots, Inc., Dollar General Corporation, Giant Eagle, Inc., Jo-Ann Stores, LLC, Ollie’s Bargain Outlet Holdings, Inc., Tuesday Morning Corporation, and Ulta Beauty, Inc.

On October 22, 2020, the attorneys who filed this class action filed an earlier one, in which plaintiff Daniel Garcia brought suit against American Eagle Outfitters, Inc., also for charging sales tax on face masks.

The claims in that case rested in part on guidance from the Pennsylvania Department of Revenue. This complaint quotes that guidance as saying, “Protective face masks that are sold at retail are exempt from Pennsylvania sales tax during the emergency disaster declaration issued on March 6, 2020 by Governor Wolf. The emergency disaster declaration was issued in response to the Covid-19 pandemic.”

That guidance has since been updated. This complaint quotes the updated guidance as saying that “face masks (cloth and disposable) are exempt from Pennsylvania sales tax.” Masks used to be taxable, the guidance says. “However, masks (both cloth and disposable) could now be considered everyday wear/clothing as they are part of the normal attire. Generally speaking, clothing is not subject to Pennsylvania sales tax.”

The complaint alleges that the defendants in this case charged customers sales tax when they sold masks in or into Pennsylvania via their stores or websites.

The complaint reviews the mask purchases of each of the seven plaintiffs in this case, setting forth the details of when and where the masks were purchased and the amount of sales tax charged.

Nine classes have been defined for this class action, including the Big Lots Class, Dollar General Class, Giant Eagle Class, Jo-Ann Class, Ollie’s Class, Home Depot Class, Tuesday Morning Class, Ulta Beauty Class, and Walmart Class. The class definitions follow a regular pattern:

The [Retailer Name] Class is all persons who bought a protective face mask or face covering, since March 6, 2020, from [Retailer Name] at a retail store in Pennsylvania or from [Retailer Name] over the Internet for delivery into Pennsylvania, and who were charged for sales tax.

See pages 21-23 of the complaint linked below to see the exact wording for each class.

This case and three other similar ones were recently moved together to federal court.

Article Type: Lawsuit
Topic: Taxes

Most Recent Case Event

Large Retailers No State Tax Due on Face Masks Pennsylvania Complaint

December 28, 2020

This class action brings suit against a variety of businesses operating in Pennsylvania, including Walmart, Inc. and the Home Depot, Inc. for charging sales tax on face masks. The complaint alleges that masks are exempt at the moment from Pennsylvania state sales tax, and claims that the companies who have been collecting it from consumers have been violating the state’s Unfair Trade Practices and Consumer Protection Law (UTPCPL).

Large Retailers No State Tax Due on Face Masks Pennsylvania Complaint

Case Event History

Large Retailers No State Tax Due on Face Masks Pennsylvania Complaint

December 28, 2020

This class action brings suit against a variety of businesses operating in Pennsylvania, including Walmart, Inc. and the Home Depot, Inc. for charging sales tax on face masks. The complaint alleges that masks are exempt at the moment from Pennsylvania state sales tax, and claims that the companies who have been collecting it from consumers have been violating the state’s Unfair Trade Practices and Consumer Protection Law (UTPCPL).

Large Retailers No State Tax Due on Face Masks Pennsylvania Complaint
Tags: Improper Sales Tax Charges, Sales Tax, Tax