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On March 10, 2015, a bipartisan group of senators introduced the Marketplace Fairness Act of 2015. Similar legislation – the Marketplace Fairness Act of 2013 – was previously introduced in February 2013 and passed by the Senate on May 6, 2013. That legislation failed to be enacted. If passed, the Marketplace Fairness Act of 2015 would authorize states meeting certain requirements to require remote sellers that do not meet a "small seller exception" to collect their state and local sales and use taxes. For more information on the previous legislation, visit Federal Government Introduces New Remote Seller Bill. (Marketplace Fairness Act of 2015, March 10, 2015)

 

UPDATE: This bill failed to pass during the 114th Congressional Session running from January 3, 2015 to January 3, 2017.  Therefore, this bill has died and would need to be reintroduced to be considered and voted on.

(03/16/2015)

On December 16, 2014, President Barack Obama signed the Consolidated and Further Continuing Appropriations Act, 2015, for sales and use tax purposes. The Act includes a provision that extends the Internet Tax Freedom Act (ITFA) until October 1, 2015 with all provisions unchanged.

 

On January 9, 2015, the House of Representative introduced a bill (un-numbered) that would permanently extend the ITFA, banning states and local jurisdictions from imposing any new tax on internet access. The proposed bill removes the current effective dates of November 1, 2003 through October 1, 2015 and changes the effective date to be effective for new taxes imposed after the date of the enactment.  It is not clear if states that have been grandfathered under the existing provision could retain their current tax on internet access but it appears that may be the case.  No formal legislation has been introduced that would incorporate the Marketplace Fairness Act into this bill. The bill is sponsored by House Judiciary Committee Chairman Bob Goodlatte, among others.

 

For our previous news item on this topic, see Internet Tax Freedom Act is Extended Through December 11, 2014.

 

For an update on this news item, see Internet Tax Freedom Act Extended Until December 11, 2015.

 

(Consolidated and Further Continuing Appropriations Act, 2015; H.R. 235)

(02/12/2015)

President Barack Obama has signed federal legislation extending the Internet Tax Freedom Act (ITFA) through December 11, 2014 as part of the joint resolution which made continuing appropriations for fiscal year 2015. The ITFA was previously set to expire on November 1, 2014. The ITFA bars state and local governments from imposing multiple or discriminatory taxes on electronic commerce and taxes on Internet access.

 

For an update to this news item, see Internet Tax Freedom Act Extended Until October 1, 2015, Permanent Extension Introduced.

 

(P.L. 113-164 (H.J. Res. 124), 113th Congress, 2nd Session, Laws 2014)

(09/26/2014)

Massachusetts has enacted legislation creating a tax amnesty program, which will take place during September and October 2014. Under the program, penalties will be waived for taxpayers who pay their outstanding taxes and interest in full. Unlike most other amnesty programs, this program only applies to assessments that were issued prior to July 1, 2014. On September 2, 2014, tax amnesty notices showing the tax and interest due, along with the penalties to be waived, will be mailed to taxpayers who qualify for the program. If taxpayers pay the tax and interest shown on the bill on or before October 31, 2014, the state will waive the unpaid penalties for the period. In addition to sales and use taxes, the additional tax types that are eligible for the amnesty period include boat and recreational vehicle sales taxes; cigarette, cigar, and smoking tobacco excise taxes; convention center financing fees on rooms, parking and certain tours; club alcoholic beverage excise taxes; gasoline excise taxes; individual income taxes; material man sales taxes; meals taxes, including local option taxes; room occupancy excise taxes, including local option taxes; special fuels excise taxes; and withholding taxes. (H.B. 4001, Laws 2014, effective retroactively to July 1, 2014; What You Need to Know About the Tax Amnesty Program, Massachusetts Department of Revenue, July 21, 2014)

(08/19/2014)

Subscriptions to a taxpayer’s virtual event center are subject to Massachusetts sales and use tax as prewritten software. The virtual event center is a platform consisting of a customizable website that allows customers to create their own online events. Customers access the virtual event center online and use design tools provided by the taxpayer’s software to design their own event website. The subscriptions are taxable as prewritten software because the object of the transaction is the use of the software to create an online event. All software delivery methods are taxable in Massachusetts including SaaS so there is not a requirement for the software to be downloaded to be taxable.  Additionally, customers are given a license to use the software, which is generally a taxable transaction. Services provided by the taxpayer, such as design assistance and technical project management, are subject to tax if sold along with the subscription in a bundled transaction for one price. These services may not be subject to tax if they are sold as separately stated optional services. (Letter Ruling 13-5, Massachusetts Department of Revenue, June 4, 2013)

(05/06/2014)

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