Iowa Adds Guidance About Sales Tax for Web Hosting Services

The Iowa Department of Revenue issued guidance stating that web hosting is not taxable as a service in the state. While web hosting is not defined by existing rules, it is “generally understood as an online service that allows users to publish their website files onto the internet to make the website available for public access.” Web hosting is the publication of data rather than just the storage of data. So, because Iowa only taxes software as a service, web hosting is not taxable in the state. (Iowa Department of Revenue, Taxation of Specified Digital Products, Software, and Related Services, effective immediately)

Posted on November 11, 2021