News & Tips

Here you can read up on significant developments in the world of sales and use tax. Find the latest legislative updates and helpful tips to keep you in compliance across all 50 states. You can filter news items by topic and/or a jurisdiction of interest.

California Court of Appeals Upholds Regulation 1585 Standard That Sales Tax is Due on Full Price of Cell Phone

The California Court of Appeals Third Appellate District has released their judgment in the case Bekkerman et al., v. California Department of Tax and Fee Administration (CDTFA) (Case Number C093763), which challenged Regulation 1585 on both actual and procedural grounds.

Virginia Budget Updated for Sales Tax Expansion to Digital Goods

Virginia Governor Glenn Youngkin signed the state budget bills, H.B. 6001 and H.B. 6002, on May 13.

Subscription-Based Membership Fee Not Taxable in Colorado

The Colorado Department of Revenue has issued a private letter ruling regarding the taxability of subscription-based membership fees, the primary benefit of which is to provide the purchaser with free delivery.

Washington Clarifies Sales and Use Tax for Live Online Classes

As of February 7, 2024, Washington State has provided guidance on the taxability of live online classes.

Maryland Enacts Electronic Filing Requirement for Sales and Use Tax and Other Taxes

Effective for tax periods beginning in 2027 (i.e. periods beginning after December 31, 2026), Maryland will require electronic filing of tax returns for specified tax types.

New York Updates Cap Amount for Sales Tax Exemption for Electronic News Services

The cap amount for the New York sales and use tax exemption on sales and uses of electronic news services is set to increase.

Music Streaming in New Orleans, Louisiana Deemed Not Taxable Under Internet Tax Freedom Act

The Louisiana Board of Tax Appeals (Board) ruled that music streaming services provided by Apple (Apple Music) are not subject to tax in New Orleans (City) under the Internet Tax Freedom Act (ITFA).

Arizona Introduces Certification Process for Third-Party Service Providers in TPP Transaction Sourcing

On April 10, 2024, Arizona\’s Governor signed H.B. 2382, establishing a new certification process for third-party service providers that assist with transaction privilege tax (TPT) sourcing.

Colorado Changes Requirements for Home Rule Jurisdictions Not Using SUTS

On April 4, 2024, Colorado\’s Governor signed H.B. 1041 into law, aimed at streamlining sales and use tax filing processes.

Kansas Overrules Governor Veto to Enact New Exemptions, Deductions from Tax Base

At the end of April, the Kansas legislature overrode the governor\’s veto of a bill that provided multiple new exemptions and changed the treatment of manufacturer\’s coupons for sales and use tax.

Texas Issues Letter Ruling Providing Guidance on Various Website-Related Services

The Texas Comptroller has issued a private letter ruling in response to a taxpayer’s request regarding the taxability of website design, development, marketing, and advertising services.

South Carolina Enacts Exemption for Feminine Hygiene Products

On May 13th, the governor of South Carolina signed a bill bringing into effect a sales tax exemption for feminine hygiene products.

Oklahoma Amends Definitions of Food and Food Ingredients for Sales Tax Exemption

For purposes of Oklahoma’s sales tax exemption for food and food ingredients, the state has clarified the definition of “prepared food” and added definitions for “bottled water” and “food sold with eating utensils provided by the seller.”

Mississippi Changes and Extends Dates for Annual Back to School Sales Tax Holiday

Mississippi Gov. Tate Reeves has signed legislation that makes several changes to the state’s annual back-to-school sales tax holiday.

Maine Updates Rules for Timing of Sales Tax on Rental Equipment

Effective January 1, 2025, Maine has updated the definitions in their sales tax code to allow businesses who purchase property that will be rented to customers to use an exemption certificate.

Nebraska Enacts Sales and Use Tax Exemption for Diapers

Nebraska has enacted legislation that creates a sales and use tax exemption for diapers, effective July 1, 2027.

North Carolina Underscores the Significance of Timely Compliance in Sales Tax Disputes

In the case of North Carolina Department of Revenue v. Hayden Olivia Bridal, LLC, the North Carolina Department of Revenue (the \”DOR\”) filed a Petition for Judicial Review against Hayden Olivia Bridal, LLC (the \”Taxpayer\”) concerning a tax assessment.

Texas Adopts Rule Defining Locations Where Orders Are Received for Online Orders, Fulfillment Warehouses

To clarify their position on orders fulfilled from warehouses as well as automated website orders, the Comptroller of Public Accounts for the state of Texas has added a section to the state\’s administrative rules defining which local tax is due on sales.

Arizona Provides Clarification on Timeliness of Electronic Tax Payments

Arizona has enacted legislation that clarifies the timeliness of electronic tax payments.

Virginia Extends Annual Sales Tax Holiday

Virginia has enacted legislation that extends the sunset date of the state’s annual sales tax holiday from July 1, 2025 to July 1, 2030.

Louisiana Denies Retailer Bad Debt Refund for Purchases on Store Cards

The Louisiana Court of Appeals has denied Dillard\’s department store their appeal for a refund of sales tax remitted for purchases customers paid for with store credit cards.

Out-of-State Retailer May Collect Sales Tax According to Colorado DOR General Information Letter

In a General Information Letter dated March 4, 2024, the Colorado Department of Revenue provided clarification about the sales and use tax notice and reporting requirements for noncollecting retailers in Colorado.

New York Rules Federal Service Fees Partly Subject to Tax in Bundled Telecommunication Service Ruling

A judge for the New York State Department of Tax Appeals denied a Time Warner subsidiary’s appeal of an audit ruling related to sales tax not collected on Federal fees charged to customers on bundles of interstate and in-state Voice over internet protocol (VoIP) services.

Washington Court of Appeals Upholds Pre-Marketplace Facilitator Amazon FBA Seller Liabilities

In a ruling filed on January 23, 2024, the Court of Appeals of the State of Washington denied an appeal of an audit assessment made by the Department of Revenue on sales made by two Amazon sellers between 2011 and 2018.