Shaking things up in state and local tax
Shaking things up in state and local tax
By Nicole Boutros and Marc Simonetti
The Illinois Appellate Court held that a defendant out-of-state retailer was not liable under the state’s False Claims Act because it conducted a good faith inquiry into its use tax collection obligations for both its Internet and catalog sales. The defendant had franchisees operating in Illinois and sold products…
By Alla Raykin and Tim Gustafson
The Colorado Department of Revenue determined that energy purchased by a television broadcaster is exempt from sales tax when used to transmit broadcasts, but taxable when used for other office purposes. Colorado imposes sales tax on electricity and natural gas for commercial consumption. The Department analyzed possible exemptions applicable…
By Mike Kerman and Jonathan Feldman
The Florida Department of Revenue advised that certain materials and labor a taxpayer plans to use to construct a combined heating and power plant will be exempt from Florida sales and use tax. The plant will produce electricity for sale. Florida exempts purchases of machinery and equipment necessary to …
By Chelsea Marmor and Andrew Appleby
The Kentucky Court of Appeals held that a Kentucky statute, which retroactively reduced vendors’ 1% deduction of the sales tax collected and remitted to Kentucky to $1,500 in any monthly reporting period, did not violate the Kentucky Constitution. Wal-Mart argued that the statute violated the Kentucky Constitution because the…
By Alla Raykin andf Eric Coffill
The Minnesota Supreme Court upheld the Minnesota Tax Court’s award of attorney’s fees to a taxpayer that had challenged the Minnesota Commissioner of Revenue’s assessment of sales and use tax. The Minnesota Supreme Court affirmed the Tax Court decision, because it reasonably concluded that the Commissioner’s additional use tax…
The Virginia Department of Taxation (Department) ruled that a company’s sales of cloud computing services did not create nexus with Virginia for corporate income tax purposes. The Department also said that in applying P.L. 86-272, it uses the same “solicitation” test for both the sales of intangible personal property…
By Robert Merten and Madison Barnett
The South Carolina Department of Revenue issued a revenue ruling concluding that charges paid by customers to stream media content over the Internet, such as movies, music and television programs, are subject to state sales and use tax. Under South Carolina law, the statutory definition of “tangible personal property&rdquo…
By Nick Kump and Marc Simonetti
The Georgia Department of Revenue (Department) released a letter ruling stating that a taxpayer’s sales of computer software and related services were not subject to sales and use tax. The taxpayer sold bundled packages for a single price that included electronically transferred computer software with corresponding updates and upgrades…
By Hanish Patel and Eric Coffill
The Alabama Tax Tribunal held that a taxpayer was entitled to a refund of sales taxes paid on purchases of software that was modified for its exclusive use because it constituted nontaxable custom software. Relying on its regulation, the Alabama Department of Revenue (DOR) denied the refund, stating the…
By Charles Capouet and Todd Lard
The Supreme Court of Texas held that an oil and gas exploration and production company’s purchases of casing, tubing, other well equipment, and associated services were not exempt from sales tax under various processing exemptions. Texas provides multiple exemptions from sales tax for certain tangible personal property related to…
