SALT Blog - SALT Blawg

by Jennifer Karpchuk

CONNECTICUT

Connecticut Finds Scholastic Used Teachers to Sell Books Creating Nexus to Subject it to Sales Tax

The Connecticut Supreme Court reversed a lower court’s decision and held that Scholastic Book Clubs, Inc. was subject to state sales tax because in-state school teachers acted as its representatives, thereby creating the requisite nexus to justify imposing the tax.  For prior coverage of this issue.

GEORGIA

Georgia Lawmakers Approve “Amazon” Bill

The Georgia Senate approved legislation, HB 386, which would create click-through nexus and establish a phase-out of the sales tax on energy used in manufacturing.

INDIANA

Indiana Supreme Court Holds Out-of-State Service Provider’s Promotional Materials Subject to Tax

The Indiana Supreme Court held that an out-of-state online service provider, AOL, Inc., was subject to Indiana use tax on promotional materials that it distributed to in-state individuals.  The court found that the transactions through which AOL obtained the promotional materials it sent to in-state residents from its assembly houses and letter shops constituted retail transactions and were therefore subject to state tax once AOL used the property in-state.

KANSAS

Kansas Senate Approves Single-Sales-Factor Legislation

The Kansas Senate approved legislation, HB 2157, which would enact a single-sales-factor apportionment method for certain corporations relocating to the state.  The apportionment method would be available beginning in tax year 2013 for those businesses with no employees in the state and with no real or tangible personal property in the state prior to January 1, 2013.

MARYLAND

Maryland Legislature Strips Bill of “Amazon” Language

The Maryland House amended legislation, SB 523, by pulling language pertaining to an “Amazon” law.  The amendment deleted language that would have required remote sellers to collect sales taxes on purchases by in-state buyers.  The House also revised the proposed individual income tax increase.

MINNESOTA

Minnesota Legislature Passes Bill to Phase-Out State’s Business Property Tax

The Minnesota House of Representatives passed legislation, HF 2337, which would phase-out the state’s business property tax.  The legislation would gradually reduce the tax, until an ultimate elimination of the tax during tax year 2025.  The legislation would also offer a tax credit in lieu of the current foreign operating corporation deduction.

SOUTH CAROLINA

South Carolina Publishes Revenue Ruling on Software

The South Carolina Department of Revenue issued a Revenue Ruling dealing with sellers who sell and deliver software via a laptop to the buyer’s location.  Where the seller downloads the software via the internet or other wireless connection and then terminates the connection, taking the laptop when the download is complete and leaving no tangible software behind, the transaction is not subject to South Carolina sales tax.

South Carolina Supreme Court Rules for Taxpayer in Bi-furcated Apportionment Case; Places Burden on DOR

In a victory for the taxpayer, the South Carolina Supreme Court held that where the South Carolina Department of Revenue (“DOR”) attempts to deviate from the standard method of apportionment, the DOR must bear the burden of proving both that the standard method should not be used and that the alternative method is reasonable and more appropriate than any of the opposing methods.

TENNESSEE

Tennessee Legislature Considers Phase-Out of Stat’s Inheritance Tax

The Tennessee General Assembly passed legislation, SB 3762/HB 3760, which would phase-out the state’s inheritance tax.  Pursuant to the legislation, the tax would be repealed by 2016.