Taxing Legal Service

Earlier this month, the Pennsylvania Senate Finance Committee approved a bill which would impose a sales tax on most legal services. The bill, known as SB-76, would tax any legal services except in the areas of family law (divorce, child support, alimony, etc) and criminal defense.  The bill will now be considered by the full Senate for approval. 

The imposition of a tax on legal services is a bad idea for several reasons. First and most obviously, a tax will result in higher cost to the client.  While no one likes to pay more money, increased fees will disproportionately impact low to middle income families.  Unfortunately, people in this demographic tend to be the most vulnerable and therefore have the greatest need for legal representation and access to the judicial system.  Statistics clearly show that lower income people are far more likely to be dragged into court than higher income people (who are often doing the dragging).  The burden of higher costs for legal services falls on those who are least able to bear it, and will have the effect of restricting access to the courts for seniors, the unemployed, and others on a low or fixed income, or facing difficult times.  Higher legal costs will also give the wealthy an unfair advantage over those that are less able to afford an attorney; accentuating the disadvantage of the less privileged.

Additionally, passage of SB-76 would make legal work the only professional service subject to a sales tax, placing it on par with the sale and consumption of commodities and non-essential services, like lawn care, self-storage, and premium cable. But for someone facing eviction or foreclosure, or who has been devastatingly injured, or is facing a crippling lawsuit, legal representation is an absolute necessity.  Fair access to our courts is not a commodity.  It is an essential service.

The court system serves many important and diverse functions, but its role is the same. Whether it is a divorce, a wrongful death lawsuit, a contract dispute, or a criminal case, the court is there to provide justice.  Access to justice is a constitutional right, not a luxury.  Anything that restricts access to the courts restricts access to justice.

Posted on September 21, 2014, in Business/Corporate Law, Personal Injury and tagged . Bookmark the permalink. Comments Off on Taxing Legal Service.

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