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The cannabis industry is still in its infancy, but with expanded legislation and ever-flowing capital, it stands to grow from a projected $27.7 billion in 2022 to over $149 billion by 2031. The race-to-market and product demand now support over 425,000 jobs, and that’s with only 22 states supporting recreational use. In fact, Maryland and Missouri have become the latest states to pass recreational laws beginning in November 2022.
Now more than ever, states are stepping up efforts to fill their coffers by auditing companies for sales and use tax. With the Wayfair decision affecting remote sellers and the proverbial pause in audits in 2020 due to COVID, sales tax audits are becoming more prevalent in every applicable state. In fact, state sales tax revenue grew by 40% year over year from 2020 to 2021 alone. While part of that is obviously due to companies normalizing their business activities, it’s also been a collective effort by states to make up for lost time and substantial dollars. Like most states, Pennsylvania has its share of intricacies when it comes to sales tax, so let’s examine ways for the taxpayer to safely navigate a PA sales tax audit.