Shaking things up in state and local tax
Shaking things up in state and local tax
By Jessica Kerner and Charlie Kearns
The Massachusetts Department of Revenue determined that the sale of access to an online database was not subject to sales and use tax because the “object of the transaction” was nontaxable data processing services rather than taxable prewritten software. The taxpayer sells subscriptions to a website that allows purchasers…
By Derek Takehara and Timothy Gustafson
The Virginia Tax Commissioner ruled that a taxpayer’s provision of electronic document and programming services in conjunction with its delivery of printed materials was not subject to sales and use tax. In addition to its sales of printed materials, the taxpayer provides electronic document services that allow customers and…
By Jessica Kerner and Timothy Gustafson
The Indiana Department of Revenue determined that the storage of advertising catalogs in Indiana, for a taxpayer’s out-of-state clients, did not create sales tax nexus for such clients. The taxpayer stored the catalogs at its facilities in Indiana prior to distributing the catalogs to recipients throughout the United States.
Minnesota issued additional guidance regarding its taxation of digital goods, which became effective July 1, 2013. For more details, view the Sales Tax Fact Sheet issued by the Department of Revenue.
By Mary Alexander and Andrew Appleby
The Missouri Department of Revenue determined that a Missouri-based seller was required to collect and remit sales tax on sales to a Missouri-headquartered customer despite the fact that the items were shipped to the customer’s out-of-state locations. The seller fulfilled the orders by delivering the purchased items to a…
By Zachary Atkins and Prentiss Willson
The Missouri Department of Revenue issued a letter ruling in which it determined that the sale or rental of streaming video content is not subject to Missouri sales or use tax. The service in question allowed customers to purchase or rent video content and to stream the content through…
By Derek Takehara and Andrew Appleby
The Oklahoma Tax Commission issued three Letter Rulings addressing the digital economy. First, the Commission ruled that receipts from sales of digital photos, videos and designs delivered via the Internet are not subject to sales tax when no tangible item is conveyed. The Commission also ruled that charges for…
By Madison Barnett and Jonathan Feldman
The Illinois Supreme Court held that Illinois’ local Retailers’ Occupation Tax (ROT) sourcing regulations—which applied a bright-line test to assign sales to the location where the purchase order was accepted—were not supported by the controlling tax imposition statutes and thus were invalid. The taxpayer, like many others in Illinois, established…
By Sahang-Hee Hahn and Timothy Gustafson
Less than two months after Massachusetts enacted a tax on computer design and software services (Tech Tax), the legislation was repealed with the passage of House Bill (HB) 3662 (for Sutherland’s previous coverage of this development, click here). The Tech Tax expanded Massachusetts’s sales and use tax…
By Maria Todorova and Prentiss Willson
The Minnesota Tax Court held that computer software consulting and implementation services were not subject to sales tax in Minnesota. The taxpayer, SAP Retail, Inc., licensed enterprise resource planning software. It also provided consultation and implementation services to configure the software to a customer’s particular business activities. The court…
