Pennsylvania Statutes Title 71 P.S. State Government § 720.10. Exemption from taxation (Adm. Code § 2810-C)

(a) The effectuation of the authorized purposes of the authority shall and will in all respects be for the benefit of the people of the Commonwealth of Pennsylvania and since it will as a government instrumentality of the Commonwealth be performing essential government functions in effectuating such purposes, the bonds or other evidences of indebtedness issued by the authority, their transfer and the income therefrom, shall at all times be free from taxation within the Commonwealth of Pennsylvania.

(b) The authority may covenant and consent that the interest on certain of its bonds shall be includible, under the Internal Revenue Code of 1954  1 or any subsequent corresponding internal revenue laws of the United States, in the gross income of the holders of the bonds to the same extent and in the same manner that the interest on bills, bonds, notes or other obligations of the United States is includible in the gross income of the holders thereof under said Internal Revenue Code or any such subsequent law. Notwithstanding any such covenant or consent of the authority, the exemption provided in subsection (a) shall not be affected thereby.