taxability

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The Colorado Court of Appeals held that the City of Aurora correctly levied use tax on American Multi-Cinema, Inc.’s (AMC’s) license agreements with film distributors. The court concluded that the true object of the arrangement was to obtain tangible personal property (i.e., the data files) rather than being a nontaxable, intangible right. In the past,…

In a recent private letter ruling, the South Carolina Department of Revenue held that software subscription services are tangible personal property subject to sales and use taxes. A software company that provides a cloud-based business management and billing platform for medical equipment suppliers requested the letter ruling to determine whether its subscription charges were subject…

The Alabama Supreme Court ruled that all software, including custom software, is tangible personal property subject to Alabama sales tax. The taxpayer filed refund claims for sales tax paid on computer software and accompanying equipment, claiming that an Alabama Department of Revenue regulation exempted these purchases from the sales tax as “custom software programming.” The…

On March 26, 2019, the Washington Court of Appeals held that a pharmacy benefit management company’s payments from clients (e.g., health maintenance organizations, health insurers, etc.) for the value of prescription drugs, were subject to the Washington B&O tax. The taxpayer manages the clients’ prescription drug benefit programs and performs activities, including contracting with third-party…

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…

The Texas Comptroller ruled that a taxpayer, which provided education and networking services for the property management industry, was not providing “information services,” but rather a non-taxable service. Taxable information services involve “furnishing general or specialized news or other current information” or “electronic data retrieval or research.” Tex. Tax Code § 151.0101(a)(10), 151.0038; Texas Rule…

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…