Charles D. Stein Revocable Trust v. General Felt Industries, Inc.

JOHNSON, J.:

¶ 1 In this appeal we determine whether Philadelphia Business Privilege Tax (BPT) and Net Profits Tax (NPT) imposed on the lessor of a commercial leasehold are taxes arising by reason of the occupancy, use or possession of that leasehold. We hold that BPT and NPT do not so arise because they do not derive from “actual physical control” of the leasehold real estate by the lessee. We conclude accordingly that a lessor may not compel its lessee to pay either tax on the assertion of lease terms requiring the lessee’s payment of “taxes arising by reason of the occupancy, use or…