Landmark 1961 Pennsylvania Sales and Use Tax Case

In March 1957, an accountant from the Pennsylvania Sales and Use Tax Bureau performed an audit of Erie Plating Company, and retroactively assessed use taxes on Erie Plating Company's purchases of supplies. This assessment violated the precedent that, as a manufacturing company, Erie Plating Company was exempt from the tax, and results in double-taxation. That is, the electroplating processes applied to the component parts were taxed, and then the same processes were re-taxed in the sale of the final product. In July, Erie Plating Company filed a petition for reassessment, a hearing was held in January of the following year, and three months later the Bureau reaffirmed its assessments.

Erie Plating Company again appealed for reassessment, and the issue came to a head on December 17, 1958, during the second hearing on the issue. Addressing the court, Lewis T. Briggs Sr. said:

Such interpretation [of the Sales and Use Tax Law] is unfair to Pennsylvania industry... because we are competing with electroplaters in Ohio and New York where no such tax is imposed.

The business of industrial metal finishing in which we are engaged is a highly competitive manufacturing enterprise. The latest published national average of profit for the industry is less than 2% of the sales dollar before federal taxes and we must therefore depend on a large volume with economical operation to keep out of the red. The imposition of a use tax on our purchase of supplies and equipment would certainly result in an overall net loss.

Two weeks later, the Pennsylvania Board of Finance and Revenue rescinded the assessments in total. However, in March 1959, the Pennsylvania Department of Revenue issued a lawsuit against Erie Plating Company. This was the first instance in the 30-year history of the Pennsylvania Board of Finance and Revenue in which any state department had countermanded its decision.

Trial began October 10, 1960, and on February 14, 1961, the court presented its decision that the Pennsylvania Board of Finance and Revenue was in error, thereby declaring that electroplating is not, in fact, manufacturing, and that therefore electroplaters are not exempt from sales and use taxes.^[3]

In response, Erie Plating Company issued the following statement:

In view of the adverse court decision metal finishers throughout the state are now liable for Use Tax dating back to September 1, 1953 plus a 25% penalty plus interest at 6%.

What this means to the metal finishing industry in Pennsylvania is tragic to contemplate. It seems inevitable that some operators will be put out of business --- many, even among the strongest, will be forced to do major refinancing, and not a few are considering moving out of state.

Notwithstanding, Erie Plating Company survived the discriminatory ruling, and chose to retain operation in the state of Pennsylvania.^[4]

1963 Erie Urban Renewal Act

In 1963, Erie Plating Company was one of the first companies to embrace the Erie Urban Renewal Act and participate in the Liberty-Sassafras Redevelopment Program, enhancing community business development in the City of Erie Pennsylvania.^[5]

1972 – Fighting against cadmium price-fixing

In 1972, Lewis T. Briggs Jr., as a member of the North American Metal Finishing Society's Strategic and Critical Materials Committee, placed formal accusations with the United States Tariff Commission against the major American cadmium producers as represented by the Lead Zinc Producers Committee. The accusation was that:

No other metal has been so completely controlled by a group of U.S. producers for their own selfish interests [as cadmium has been]. And we find it hard not to suspect that illegal price rigging and manipulative practices are taking place again.

Efforts by the Cadmium Lobby to prevent the importation of cadmium from Japan under the guise of 'dumping' is not only unfair, but constitutes a very obvious sham. Their purpose is most transparent --- by limiting the importation of this critical and strategic material, U.S. cadmium producers would have an even freer rein to control the sale and distribution of this metal.

The North American Metal Finishing Society, under the advice of Lewis T. Briggs Jr., urged the United States Tariff Commission to encourage the importation of foreign cadmium to help stabilize the market.^[6]

2000: Erie Plating Company's 75th Anniversary

In September 2000, Erie Plating Company was recognized for 75 years of business in the city of Erie, in a ceremony conducted by Erie Mayor Joyce Savocchio, Erie County Executive Judy Lynch, and Pennsylvania State Governor Tom Ridge.^[7]

Today

In 2008, Erie Plating Company employs about 125 employees at its 100,000 square feet (9,300 m²) central plant, which ranks among the top 40% of the cleanest industrial facilities in the United States according to Scorecard's Environmental Release Survey.^[8]

Recent products include the chrome plating on AMSCO operating table handles, gas pump handles at service stations, auto parts, and components of measuring tools and computers.^[9]