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Google unveiled an open-source, royalty-free video format called WebM on Wednesday, lining up commitments from Mozilla and Opera to support the encoding technology in their browsers and pledging to support it on its YouTube site.

"The WebM project is dedicated to developing a high-quality, open video format for the Web that is freely available to everyone," the WebM Web page states. As expected, Google made the move in conjunction with its Google I/O conference Wednesday.

It's not yet clear how much success Google will have spreading WebM, but the company has big Web ambitions, a powerful brand, heavy influence through the popularity of YouTube, and deep pockets to help handle any legal threats to the WebM project.


The sales and use tax exemption rule on governmental entities and purchases made through purchasing agents has been amended. The rule is amended to include the ability to use Form ST:PAA-1, Purchasing Agent Appointment. This form will allow an exempt entity to appoint a purchasing agent to act on their behalf when making tax-exempt purchases. A contractor may also use this form to appoint subcontractors to make tax-exempt purchases on behalf of the exempt entity. (Rule 810-6-3-.69.02, Alabama Department of Revenue, effective January 5, 2010)


In an administrative law decision, a taxpayer’s charges for deliveries made by common carrier were determined to be taxable. The Taxpayer charged its customers a delivery fee on the sand, gravel, and similar products that it sells. The common carrier used by the Taxpayer to deliver the goods is also owned by the same individuals. Alabama law provides that a common carrier is deemed to be the agent of the seller. Consequently, if goods are delivered by common carrier, the sale is not closed until the common carrier finishes delivery of the goods to the customer. Therefore, the delivery charges are a part of the sale and subject to Alabama sales and use tax. However, the law further provides that transportation charges paid to a common carrier are not a part of the taxable selling price if billed as a separate item to and paid by the purchaser. The Court ruled that in this case, the common carrier was clearly acting as agent for the Taxpayer when it delivered the goods to the Taxpayer's customers and as such, the delivery fees charged by the Taxpayer constituted a part of the sales subject to tax. The exception noted also does not apply because while the Taxpayer billed the transportation charges to its customers as a separate item, the Taxpayer did not pay the common carrier for hauling the goods. (Alabama Rock, LLC v. Alabama Department of Revenue, Alabama Department of Revenue, Administrative Law Decision, No. S. 09-255, September 11, 2009)


The Alabama Department of Revenue has ruled on a taxpayer's claim that paint used on government aircraft was not subject to sales and use tax. The Department of Revenue disagreed with the taxpayer's claim that the paint used on an aircraft was for corrosion protection and, therefore, qualified as a part installed on the aircraft. The definition of "parts and pieces" cited by the taxpayer related to parts used in the repair of an automobile. Another definition in the same regulation stated that painting was a service and that any materials consumed in the performance of the painting service were subject to use tax payable by the party performing the service. The taxpayer was responsible for the use tax based on these definitions. (Helispec LLC v. Alabama Department of Revenue, Alabama Department of Revenue Administrative Law Division, No. S. 08-661, July 24, 2009)


States vary on the treatment of cellular telephones and equipment when sold below cost and contingent on the purchase of airtime from a retailer or an independent carrier. It is a common practice for retailers to sell cellular phones for a significant discount with a contract for cellular phone services. Selling the phone at a significantly discounted price may constitute a sale at the reduced price or tax may be due on the normal retail value or the cost of the item sold. For example, Alabama and Illinois tax the cellular phone at the discount price, while California requires tax to be paid on the normal retail price if below 50% of the cost. Texas requires tax be paid on the cost of the item if the sales price is less than 25% of the dealer’s acquisition cost. In Massachusetts, an item transferred from a vendor to a customer for a nominal consideration or substantially below cost is considered, for sales tax purposes, a promotional item. Items sold at 50% or less of the vendor’s cost are considered substantially below cost. However, situations such as fire sales, going-out-of-a-business sales, and clearance sales may not meet this presumption.



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