The South Carolina Administrative Law Court ruled that the taxpayer was required to collect sales tax on its retail sales of prepaid cellular telephone service. The taxpayer argued that its sales did not constitute “prepaid wireless calling arrangements,” which must be “sold in units or dollars which decline with use in a known amount.” Because
Minnesota Tax Court Declares Separately Stating Tax a Winner in Tobacco Tax Dispute
The Minnesota Tax Court held that a tobacco distributor was entitled to a refund of Minnesota tobacco tax that it paid on federal excise tax (FET) that was passed through by the tobacco manufacturer, but only if the FET was separately stated on the manufacturer’s invoice. The court looked to the plain language of the
Texas Finds No Nexus in Texas for purposes of Apportioning Margin
The Texas State Office of Administrative Hearings (“SOAH”) found that the receipts of a non-nexus member of a combined group (Company A) “should be deleted” from the computation of the group’s gross receipts for purposes of apportioning revenue to the state. The group was in the business of franchising fast food restaurants. On audit, the
New Mexico Court of Appeals Upholds Tax Treatment of Franchise Trademark Royalties
The New Mexico Court of Appeals upheld the imposition of gross receipts tax on certain trademark-related royalty fees received by an out-of-state corporation pursuant to its franchise agreements with New Mexico businesses. The court examined whether, following statutory amendments in 2007, the royalty fees flowing from a limited trademark license provision contained within the franchise
New Jersey Tax Court Upholds Division’s Use of 25/50/25 Sourcing Rule
The New Jersey Tax Court upheld the New Jersey Division of Taxation’s use of the 25/50/25 sourcing rule for “certain services” against a provider of mass messaging services by fax, email and voice. Specifically, the court upheld the Division’s determination of a 76% receipts factor, which consisted of 25% for all transactions originating in New
Webcast: SALT Scoreboard – 2018 Mid-Year Review
The quarterly Eversheds Sutherland SALT Scoreboard tallies significant state and local tax litigation wins and losses. In this Bottom Line webcast, Eversheds Sutherland attorneys Charles C. Capouet and Justin B. Stone discuss the results from the first two quarters of 2018, including:
- how taxpayers have fared in litigation in the first two quarters of
Missouri Court of Appeals Affirms Tracfone Wireless Subject to City of Springfield’s License Tax
The Missouri Court of Appeals affirmed a lower court’s finding that Tracfone Wireless was a “home service provider” under the Mobile Telecommunications Sourcing Act and owed the City of Springfield unpaid gross receipts license taxes. Tracfone argued that since it was not authorized to provide commercial mobile radio services in Missouri, it had no licensed
Minnesota Supreme Court Upholds Commissioner’s Use of Alternative Apportionment for Financial Institution
The Minnesota Supreme Court held that the state’s standard apportionment method did not fairly reflect the taxpayer’s net income allocable to the state, reversing the Tax Court’s ruling. The taxpayer, a national financial institution, transferred its loan portfolios to two newly formed partnerships. For apportionment purposes, Minnesota requires financial institutions to include loan interest in
House Judiciary Committee Considers Ramifications of Wayfair Decision
On Tuesday, June 24, the Judiciary Committee of the US House of Representatives held a hearing on “Examining the Wayfair decision and its Ramifications for Consumers and Small Businesses.” The hearing was scheduled at the direction of Rep. Robert Goodlatte (R-VA), Chairman of the Judiciary Committee and did not address any specific pending or former
SALT Scoreboard – Second Quarter 2018
This is the tenth edition of the Eversheds Sutherland SALT Scoreboard, and the second edition of 2018. Each quarter, we tally the results of what we deem to be significant taxpayer wins and losses and analyze those results. This edition of the SALT Scoreboard includes a discussion of the United States Supreme Court’s decision in