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The Wisconsin Department of Revenue has revised its publication regarding the sales and use tax treatment of digital goods, specifically, newspapers and other news or information products. The sections that discuss digital books also had some small changes. In addition to explaining the taxability of digital goods, the publication gives details on seller's permits and use tax registration certificates, filing returns and paying tax, definitions, sourcing, and exemptions. (Publication No. 240, Wisconsin Department of Revenue, October 2009)

(12/18/2009)

The State of Wisconsin Tax Appeals Commission found that the temporary help services provided by a taxpayer were not subject to Wisconsin sales tax. The taxpayer provides its clients workers with a wide range of skills who work under the direction and control of those clients. The taxpayer pays the wages of the workers it places and also pays for withholding taxes, other payroll expenses and, in some circumstances, certain fringe benefits. In addition, the taxpayer does not contract to provide certain outcomes or results, supply tools or equipment for its workers, or train its employees to provide a particular outcome. The Department of Revenue argued the “look through” position which states that when a worker placed by the taxpayer performs a task which would be taxable if provided as part of a taxable service, then the taxpayers’ gross receipts related to that task are subject to the sales tax. On the other hand, the taxpayer contended that temporary help services are not one of the services enumerated under Wisconsin law and provided several claims in support of this. Additionally, the taxpayer was audited three previous times and was not issued a similar assessment. The Commission found that Department's approach goes against the rule of construction that taxes may only be imposed by clear and express language, with all doubts and ambiguities resolved in favor of the taxpayer. It was also mentioned that "temporary help services" are not listed as a taxable service, and that such services are distinguishable from the services enumerated in the Wisconsin statutes. (Manpower Inc. v. Wisconsin Department of Revenue, Wisconsin Tax Appeals Commission, No. 05-S-046, August 12, 2009

(09/24/2009)

As part of Wisconsin’s membership in the Streamlined Sales and Use Tax Agreement, Wisconsin will offer a sales tax amnesty program for qualifying businesses that currently are not registered to collect and remit sales and use tax. The Wisconsin amnesty period runs from July 1, 2009 to September 30, 2010. To qualify, businesses must voluntarily register (between the above dates) to collect and remit Wisconsin sales tax, as well as sales tax for all other states that have been members of the SST Agreement for at least 36 months. Businesses that meet the eligibility requirements and register for the program will not be required to remit Wisconsin sales and use tax on sales made prior to registration for the amnesty program. The program does not apply to any sales and use tax that a person owes as a purchaser. Businesses are eligible for the program unless one or more of the following apply: 1) currently registered to collect Wisconsin sales tax; 2) registered to collect Wisconsin sales tax at any time during the past 12 months; 3) received an audit notice, unless the audit and all related appeals are resolved; and/or 4) committed or been involved in fraud or intentional misrepresentation. Additional rules and regulations apply. (Wisconsin offers Streamlined Sales Tax amnesty program, Wisconsin Department of Revenue)

(08/27/2009)

As a result of the Menasha decision, Wisconsin amended its definition of "tangible personal property" to include prewritten computer software, regardless of how it is delivered to the purchaser. Previously, "tangible personal property" included computer programs except custom programs. This amendment, which reverses the decision made in the Menasha case, has an effective date of March 6, 2009. Therefore, sales of prewritten computer software with a modification or enhancement that is designed and developed to the specifications of a specific purchaser will be taxable in full if there is not a reasonable separately-stated charge on an invoice or other statement of the price given to the purchaser for the modification or enhancement. If, however, there is a reasonable separately stated charge for the modification or enhancement, that portion of the charge will be exempt. (News for Tax Practitioners, Wisconsin, Department of Revenue, March 16, 2009)

(05/15/2009)

The Streamlined Sales Tax (“SST”) Governing Board has approved Wisconsin’s membership petition during its meeting in Arlington, Virginia, on May 12, 2009. Wisconsin will become an associate member of the SST Agreement, effective July 1, 2009, and a full member, effective October 1, 2009. (SST Governing Board Meeting, Arlington, Virginia, May 12, 2009)

(05/15/2009)

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