Shaking things up in state and local tax
Shaking things up in state and local tax
By Jessica Kerner and Pilar Mata
In an Advisory Opinion, the New York State Department of Taxation and Finance held that a taxpayer developing a data center for Internet services is eligible for the State’s sales and use tax exemption pertaining to Internet data centers. In order to qualify for the exemption, the tangible…
The Multistate Tax Commission’s (MTC) Sales and Use Tax Uniformity Subcommittee is moving forward with a broad sales tax nexus model statute that includes click-through, affiliate and attributional nexus provisions. The Subcommittee also discussed a memorandum related to class actions and false claims acts. The nexus and class action projects are in the educational stage…
We recently launched the Sutherland SALT Digital Economy Forum, which provides comprehensive state tax resources regarding the taxation of the digital economy. Following is a summary of recent digital economy administrative guidance, noteworthy cases and legislation. If you would like to learn more about the Sutherland SALT Digital Economy Forum or any of the issues covered here, please contact us.
Administrative Guidance
Continue Reading Digital Economy Update: Administrative Guidance, Noteworthy Cases and Legislation
The Tennessee Department of Revenue issued an interesting ruling addressing the taxability of two types of Internet-based services. The Department determined that the first type (facilitating remote access to the user’s computer) was a non-taxable service and the downloaded Java applet was software but not the true object of the transaction. The Department determined that…
On January 8, 2013, the Sutherland State and Local Tax (SALT) Team appeared before the Oregon Supreme Court in an important case concerning the scope of Oregon’s central assessment method of property taxation. Comcast Corporation v. Department of Revenue, Case No. S059764. The issue in the case concerns whether cable television and Internet access services are within the scope of “data transmission services” for ad valorem tax purposes. This case is being followed closely by participants in the Digital Economy (e.g., sellers of Internet access, digital goods and services, and cloud computing providers) and taxing jurisdictions throughout the country.Continue Reading Sutherland SALT Argues Digital Economy Central Assessment Case
We are pleased to announce the launch of the new Sutherland SALT Digital Economy Forum, which provides resources, legislative monitoring and advocacy, and strategic counsel on the state taxation of the Digital Economy. To access free resources on the taxation of the Digital Economy, click on the Digital Economy Forum link at the top of…
On December 18, 2012, the California Court of Appeal ruled that receipts from the right to replicate software are sourced as sales “other than tangible personal property.” In reversing the trial court, the Court of Appeal upheld the taxpayer’s use of costs of performance sourcing. Microsoft Corporation v. Franchise Tax Board, Case No. A131964…
The New York State Department of Taxation and Finance (Department) issued a pair of advisory opinions regarding the sales taxability of consulting services and software. New York’s Tax Law generally imposes sales and use tax on receipts for furnishing information services. N.Y. Tax Law § 1105(c)(1). However, in both advisory opinions, the primary transactions were not subject to New York sales tax because they were within the exception for personalized information services and information services provided orally. See 20 NYCRR § 527.3(b)(2) & (3).Continue Reading Software in Conjunction with Information Services: What’s Your Function?
In two reletter rulings, the Texas Comptroller’s office evaluated the sales and use taxability of certain unique web-based services. In Tex. Policy Letter Ruling 201207531L (July 31, 2012), the Comptroller’s office ruled that Internet marketplace listing fees were not subject to Texas sales and use tax; however, the provision of webstore development services were taxable data processing services.Continue Reading The Lone Star State Swings the Lasso Around E-Commerce Services
While most states that have “click-through nexus” sales tax laws have issued little to no guidance addressing the scope of their provisions, the Pennsylvania Department of Revenue (Department) issued guidance explaining the types of payment mechanisms that will trigger nexus.
The Department’s ruling supplements a December 1, 2011 Tax Bulletin (Tax Bull. 2011-01)…
