On February 27, 2023, the Washington Court of Appeals held that a provider of pharmacy services and pharmacy benefits services (PBM) to its affiliate’s enrollees met the insurance business exemption to the Business and Occupation Tax because its activities were at least functionally related to insurance business. The taxpayer fulfilled the PBM services required by
exemption
Virginia Circuit Court determines sales of software and equipment exempt from sales tax
In an opinion published on September 9, 2022, the Circuit Court of the City of Richmond held that a telecommunications equipment company was entitled to a sales tax refund on its sales of software, equipment, and related services sold to a telecommunications company.
Under Virginia law, software delivered electronically via the Internet is exempt from…
Washington provides sales tax exemption for urban data centers
The Washington Department of Revenue released a notice providing that effective June 9, 2022, qualifying businesses and tenants may apply for a sales and use tax exemption for purchases of server equipment and infrastructure for computer data centers located in urban areas pursuant to 2022 House Bill 1846. Eligible urban areas are those counties…
Virginia sales tax exemption expanded to include Internet network equipment
Virginia’s Governor signed H.B. 1155, which expands the sales tax exemption for amplification, transmission and distribution equipment to now include “network equipment” that is used to provide Internet service. The expanded exemption defines a “network” to include modems, fiber optic cables, coaxial cables, radio equipment, routing equipment, switching equipment, a cable modem termination system,…
No Maryland sales and use tax exemption for for-profit company’s purchases made for non-profit hospitals
The Maryland Court of Appeals held that a for-profit company’s purchases for non-profit hospitals were subject to Maryland’s sales and use tax because there was no agency relationship between the company and the hospitals, and even if an agency relationship existed, that alone would not entitle the for-profit company to an exemption.
Johns Hopkins Health…
Regulation De-construction: Pennsylvania Court Holds Statutory Amendment Superseded Regulation
On October 16, 2019, the Pennsylvania Commonwealth Court held that a bank was required to pay sales tax on its purchases of computer hardware, canned computer software, and related services because a statutory amendment superseded the bank’s relied-upon exemption regulation. The court held that the bank complied with the regulation, which exempted from sales tax…
It’s In The Way That You Use It: Massachusetts Supreme Judicial Court Applies “Great Integral Machine” Doctrine
The Supreme Judicial Court of Massachusetts held that pipes and appurtenant equipment used by a taxpayer to produce, store and distribute steam for heating and power generation were exempt from local personal property tax as manufacturing property. Affirming the Appellate Tax Board, the court applied the “great integral machine” doctrine to find that the pipes…
Wind Farm Battery System Not Eligible for Manufacturing Exemption in Texas
The Texas Comptroller ruled that the purchase of a battery system did not qualify for the manufacturing exemption from Texas sales and use taxes because it was used to store electricity, not manufacture it. The taxpayer operated a wind farm and began a project to participate in the Electric Reliability Council of Texas’ Fast-Responding Regulation…
Georgia Legislature Enacts Significant Income, Sales, and Property Tax Legislation
The Georgia legislative session concluded on March 29, 2018. In addition to two major bills relating to federal tax reform, Georgia enacted several other pieces of notable tax legislation.
View the full Legal Alert.
Delaware Sewer and Water Authority Successfully Challenges Permit “Fee” as Disguised Tax
By Mike Kerman and Jonathan Feldman
The Delaware Chancery Court held that a town’s $27,000 building permit “fee” was in substance a tax that could not be levied against a tax-exempt water and sewer authority. The town assessed the fee upon the water and sewer authority before it would issue a permit to construct a…