In this episode of the SALT Shaker Podcast, SALT Counsel Jeremy Gove and Chelsea Marmor dive into the evolving intersection of artificial intelligence (AI) and SALT.

As AI technology continues to advance, Jeremy and Chelsea draw a parallel for tax purposes to the early days of the internet – when Congress passed the ITFA to avoid taxes stifling innovation. They explore whether the existing framework for taxing software and digital products is sufficient to address AI, or if new legislation will be needed to keep pace.

Jeremy and Chelsea highlight recent developments in Indiana and Illinois, where revenue rulings classified remote generative AI chatbot services as non-taxable under the states’ existing definitions of SaaS and electronically delivered software.

The episode wraps with a brief discussion on the potential for federal intervention in regulating and taxing AI, leaving listeners with key questions about how SALT professionals should prepare for what’s next.

And, as always, the hosts close out with their overrated/underrated segment – this time tackling the world of science fiction.

For questions or comments, email SALTonline@eversheds-sutherland.com. Subscribe to receive regular updates hosted on the SALT Shaker blog.

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A Florida circuit court held for the Department of Revenue in a dispute over Florida’s apportionment formula applicable to companies providing transportation services in the state. Florida apportions income of transportation companies by multiplying the taxpayer’s income by a fraction, the numerator of which is “revenue miles in [Florida]” and the denominator of which is “revenue miles everywhere.” Florida defines the phrase “revenue miles in [Florida]” to include all miles traversed within Florida’s geographic borders and an area of ocean contiguous to Florida’s coastline.

An airline asserted that the Florida apportionment statute was unconstitutional because it violated the “internal consistency” test of the Dormant Commerce Clause. The airline argued that the statute was not internally consistent because it used air miles flown both over Florida’s landmass and over the ocean contiguous to Florida’s coastline to calculate the share of the airline’s income attributable to Florida. The court disagreed with the airline, holding that Florida’s statute was internally consistent because “if a hypothetical state were to directly import Florida’s geographical description minus Florida’s landmass, its statute would still not be ‘identical’ to Florida’s structure, because Florida’s apportionment structure is related to its own land mass by contiguity.”

JetBlue Airways Corp. v. Dep’t of Revenue, No. 2024CA1177 (Fla. Cir. Ct. Sept. 1, 2025).

The Eversheds Sutherland SALT team is coast-to-coast this week, joining three major conferences to share insights on the latest developments in SALT.

Western States Association of Tax Administrators (WSATA) Annual Conference

SALT Partner Jeff Friedman returns to the WSATA Annual Conference in Albuquerque, NM to share his perspective on recent developments shaping the SALT landscape.

Explore the full conference agenda and register here.

Tax Executives Institute (TEI) 80th Annual Conference

Partner Michele Borens will speak at TEI’s 80th Annual Conference, taking place this week in San Francisco, CA. Michele will address some of the most pressing challenges in state and local taxation, offering practical strategies for navigating complex state sourcing rules.

This year’s TEI conference promises a robust agenda and networking opportunities. Find out more information and register here.

32nd Annual Paul J. Hartman SALT Forum

Finally, SALT Partners Jonathan Feldman and Jeff Friedman will speak the 32nd Annual Paul J. Hartman SALT Forum in Nashville, TN, diving into two timely topics:

  • Precedent and deference: How agency guidance, judicial deference, and statutory interpretation can shape the outcome of a state tax dispute – and what one state’s approach might mean for others.
  • Hot constitutional topics in SALT: A deep dive into how states are testing the limits of the US Constitution in their taxing authority, with focus on the Due Process Clause, Commerce Clause, Equal Protection Clause, and more.

Whether you’re attending in person or following along online, we’re excited to connect and share insights from these events.

Calling all trivia fans! Don’t miss out on a chance to show off your SALT knowledge!

We will award a prize for the smartest (and fastest) participant.

This week’s question: Which state introduced a bill that would impose an excise tax on energy used to power cryptocurrency mining operations?

E-mail your response to SALTonline@eversheds-sutherland.com.

The prize for the first response to today’s question is a $25 UBER Eats gift card. This week’s answer will be included in our SALT Shaker Weekly Digest, distributed on Saturday. Be sure to check back then!

On October 16, the New York City Department of Finance (DOF) published a Notice of Public Hearing and Opportunity to Comment on Proposed Rules. The proposed rule is the first of a set of rules following the 2015 tax reform relating to the Business Corporation Tax (BCT).

The DOF’s statement accompanying the proposed rule states that Chapter 11A will provide regulated parties with detailed direction regarding the computation of the BCT. The DOF’s statement says it intends to maintain conformity with the NYS Corporate Tax regulations where corresponding statutory conformity exists, “while weighing the interests of the City to provide a distinct approach in areas where the parity was not historically maintained under the previous iterations of corporate taxes or where the BCT and NYS Corporate Tax statutes diverge.” Chapter 11A will be broken into nine Subchapters that “roughly correspond” to the organization of 20 NYCRR Chapter 1, Subchapter A. The first Section of the City’s proposed rule adds Subchapter 1 of the proposed BCT regulations which will pertain to the imposition of the tax and would generally parallel 20 NYCRR Chapter 1, Subchapter A, Part 1.

  • Part 1-1 of the proposed rule would provide definitions of relevant terms.
  • Part 1-2 would set forth the required minimum activities in the City for corporations to be subject to tax under the BCT. The proposed nexus rules would generally follow those of the GCT, with the addition of economic nexus provisions. This Part of the proposed rule would include “examples of activity that does not give rise to nexus, corporations that are exempt from the BCT, and detailed guidance for corporations seeking protection under Public Law 86-272.”

Specifically, § 11A-11(a-1) states that “the applicability of Public Law 86-272 to taxes imposed by New York City is determined by the nature of a foreign corporation’s activities in the entire State.” Accordingly, if in addition to protected sales solicitation activities in New York City, a foreign corporation carries on other activities in New York State that would take it outside the scope of Public Law 86-272 protection for state tax purposes, the foreign corporation will not be exempt from taxation.

For a foreign corporation to be exempt under Public Law 86-272, the activities of its employees or representatives in New York State, or activities engaged in via the Internet by such foreign corporation, must be limited to the solicitation of orders for the sale of tangible personal property, including ancillary activities, other than maintaining an office, that serve no independent business function apart from their connection to the solicitation of orders. A foreign corporation that chooses to engage in activities via the Internet for reasons other than solicitation, including interacting with customers or potential customers through such corporation’s website or computer application, will not be protected. However, a foreign corporation will not be subject to tax solely by presenting static text or images on its website.

The City’s proposed rules generally tracks the New York State Public Law 86-272 rules and provides that the following activities would go beyond solicitation:

  • Making repairs to or installing such foreign corporation’s products;
  • Making credit investigations;
  • Collecting delinquent accounts;
  • Taking inventory of such foreign corporation’s products for customers or prospective customers;
  • Replacing such foreign corporation’s stale or damaged products; and
  • Giving technical advice on the use of such foreign corporation’s products after the products have been delivered to the customer.

Both New York State’s regulations and the City’s proposed rules on Public Law 86-272 generally follow the Multistate Tax Commission’s guidance on internet activities as published in August 2021.

The effective date of the proposed rule and future proposed rules adding subsequent subchapters to Chapter 11A will be published after all subchapters of Chapter 11A have completed the rulemaking process.

The DOF will hold a public hearing on the proposed rule on November 20, 2025 at 11:00 AM. The deadline to submit written comments is November 20, 2025. Information related to attending the hearing and submitting comments may be found here: Business Corporation Tax Implementation Rules – NYC Rules.

The Eversheds Sutherland SALT Team will monitor the rulemaking process and publication of proposed rules over the coming months.

The Oregon Supreme Court held that an administrative rule involving property tax valuation methods that was duly promulgated by the Department of Revenue pursuant to statute is controlling authority insofar as the rule does not conflict with constitutional or statutory law. Oregon Administrative Rule 150-308-0690 incorporates the Western States Association of Tax Administrators (WSATA) Handbook as the official guide for valuing utility property and other centrally assessed property in Oregon. A utility company challenged the valuation methods used by the Department under the WSATA Handbook to determine the real market value of its property for tax year 2020-21, arguing that the legal effect of the handbook was limited to internal Department proceedings. The Tax Court agreed and found that the rule was not entitled to deference and therefore not binding.

The Oregon Supreme Court reversed the Tax Court’s decision. The Court concluded that because the Department had statutory authority to promulgate the rule and did so in accordance with proper rulemaking procedures, the rule was a controlling source of law “unless, if applied in fact, it would compel a result contrary to the constitution or statute.” Because the Tax Court did not apply the rule in the first instance, the Supreme Court remanded the case to the Tax Court to perform the required analysis. 

PacifiCorp v. Department of Revenue, 374 Or 189 (2025).

Calling all trivia fans! Don’t miss out on a chance to show off your SALT knowledge!

We will award a prize for the smartest (and fastest) participant.

This week’s question: Which state recently updated its conformity with the Internal Revenue Code for the first time in 10 years?

E-mail your response to SALTonline@eversheds-sutherland.com.

The prize for the first response to today’s question is a $25 UBER Eats gift card. This week’s answer will be included in our SALT Shaker Weekly Digest, distributed on Saturday. Be sure to check back then!

This week, SALT Counsel Alla Raykin is pleased to join the speaker lineup during the Institute for Professionals in Taxation (IPT) 2025 Real Property Tax School. During her session, she’ll discuss ethics as it relates to property tax professionals and IPT’s Code of Ethics.

For more information and to register, click here.

Calling all trivia fans! Don’t miss out on a chance to show off your SALT knowledge!

We will award a prize for the smartest (and fastest) participant.

This week’s question: Which state recently enacted legislation that postpones a scheduled increase to the state’s excise tax on cannabis products?

E-mail your response to SALTonline@eversheds-sutherland.com.

The prize for the first response to today’s question is a $25 UBER Eats gift card. This week’s answer will be included in our SALT Shaker Weekly Digest, distributed on Saturday. Be sure to check back then!

In this installment of “A Pinch of SALT,” published by Tax Notes State, Eversheds Sutherland attorneys Charlie Kearns, Cyavash Ahmadi and Constance Chien examine different state approaches to exempting digital inputs, including uniformity efforts in the Streamlined Sales and Use Tax Agreement and under review by the Multistate Tax Commission. They also highlight states that have adopted inadequate exemptions applicable (or inapplicable) to digital inputs.

Read the full article here.