On May 1, 2024, California Senator Steve Glazer, Chair of the Senate Revenue and Taxation Committee, unveiled another proposal to tax digital advertising. This time, Senator Glazer proposes to amend California Senate Bill 1327 to impose a 7.25% tax on “data extraction transactions in the state.”[1] This “data extraction transactions tax” (referred to as the
Not an April Fools’ Day prank: Digital advertising tax introduced in California State Assembly
On April 1, 2024, the California State Assembly amended a digital advertising tax into A.B. 2829, formerly a property tax bill. As amended, A.B. 2829 would adopt the digital advertising tax effective January 1, 2025. The California proposal is similar to the Maryland Digital Advertising Gross Revenues Tax, which is currently the subject of
Forecasting the future of FTB’s informal guidance
In this episode of the SALT Shaker Podcast, Eversheds Sutherland Counsel Jeremy Gove welcomes back Sacramento SALT Partner Tim Gustafson for another California-focused conversation!
Tim and Jeremy base their discussion around a recent article Tim co-authored in Tax Notes State with Associate Sharon Kaur about the California FTB’s informal guidance.
Specifically, they delve into the
Is California FTB’s informal guidance at a crossroads?
The California Franchise Tax Board (FTB) administers the state’s corporate franchise and income taxes. The California Legislature authorized the FTB to promulgate regulations in order to implement and interpret the governing statutes. Beyond issuing formal guidance, however, the FTB historically, and routinely, has issued informal guidance on a broad array of topics and issues for
Don’t count on a sales tax discount: California Court of Appeal supports the validity of Regulation 1585
The California Court of Appeal for the Third Appellate District held that the purchase of “discounted” cell phones bundled together with wireless services requires payment of sales tax based on the cell phone’s full price.
Plaintiffs purchased cell phones at a reduced cost, together with wireless services, in a “bundled transaction.” The bundled transaction included
Legal Alert – Better than a box of chocolates: Foreign dividends included in California sales factor denominator
On February 14, 2024, the California Office of Tax Appeals (OTA) denied the California Franchise Tax Board’s (FTB) request for rehearing in the Appeal of Microsoft Corporation and Subsidiaries (OTA Case No. 21037336). Microsoft is allowed to include 100 percent of its foreign dividend income in its sales factor denominator. This is a huge opportunity
California appellate court rejects single-subject rule challenge to single-sales factor apportionment
A California appellate court held that Proposition 39, which mandated single-sales factor apportionment, did not violate the single-subject rule. In 2012, California voters enacted Proposition 39, which established a program to promote the creation of clean energy jobs. It funded the program by eliminating the option for taxpayers to apportion its California tax based on
California Tax Foundation webinar
On February 13, join Eversheds Sutherland Counsel John Ormonde as he helps review San Francisco’s business tax structure, administrative challenges, and changes that may be presented to voters in 2024 during a California Tax Foundation webinar.
For more information and to register, click here.
Legal Alert: Reforming San Francisco’s gross receipts tax
On February 5, 2024, the Offices of the Controller and Treasurer & Tax Collector for the City and County of San Francisco published a report outlining tax reform recommendations in time to inform a potential ballot measure for the upcoming November 2024 election. The report recommends significant changes to San Francisco’s gross receipts tax.
Read
FTB audits: Considerations for handling requests for statute extensions by FTB auditors
In this article originally published by CalCPA in the September issue of California CPA, Eversheds Sutherland Senior Counsel Eric Coffill provides some considerations in deciding whether to grant or deny an auditor’s request for a statute waiver in a pending audit, a common issue arising in FTB audits.
Read the full article here.