The EU will resurrect talks on a digital services levy if a global deal on the taxation of corporate giants fails, a senior European policymaker has warned in November 2022. Zbyněk Stanjura, the finance minister of the Czech Republic, which holds the rotating EU presidency, said a number of member states fear that the US […]

The Organization for Economic Cooperation and Development (OECD) released technical guidance for its broad reform of the global tax system in which multinational companies would be subject to a minimum tax of 15% on their profits. The OECD and the G20 agreed on a so-called Pillar Two framework in 2021 for imposing a 15% minimum […]

Advertising disrupters have large research and development budgets and leverage R&D tax credits to support the technology-based charge. While research and development is not a term that in the past was often associated with the advertising industry, technological advances in recent years have changed the way the industry works, with big data and predictive analytics […]

On August 16, 2022 President Biden signed into law the Inflation Reduction Act of 2022, an approximately $730 billion health care, tax and climate bill that represents a sizable portion of the Democrats’ 2022 domestic policy agenda. Important particularly for larger agencies, a key provision of the bill is the revival of an alternative U.S. […]

Varying forms of cloud computing transactions are taxable in more than 15 states, including Texas, New York, Pennsylvania and Ohio. Obviously, the use of cloud computing is vastly expanding. In some states, these services are not taxable; in others, they are extremely taxable. Plus, a handful of states have yet to issue formal guidance. Below […]

In November 2022, General Counsel for the Multistate Tax Coalition (MTC) confirmed that the Digital Goods Sales Tax working group is developing a white paper outlining various approaches to taxing digital products. The MTC GC stressed that the working group will: (1) be constrained by the Internet Tax Freedom Act’s (ITFA’s) federal prohibition on multiple […]

A number digital advertising tax bills have been introduced in Connecticut, New York and Massachusetts to jumpstart the 2023 legislative sessions. In recent years, all three states have considered – but ultimately rejected – legislation that would adopt targeted taxes on the digital economy.  On January 18, 2023, proposed legislation was filed in the Connecticut […]

H.B. 8, which passed in March 2022, imposes Kentucky’s 6% sales and use taxes on thirty-nine (39) new classes of services, some of which are defined and others the scope of which must be clarified by administrative regulation or the courts.  The new taxable classes that could affect agencies/brands are as follows: “Marketing services”, defined […]

For many years, Washington has had a Business and Occupation (B&O) tax as the primary state business tax, yielding roughly a quarter of all state tax collections; however a bipartisan advisory group is aggressively urging the Washington state legislature to replace its B&O tax with a margin tax levied on gross receipts. The tax is […]

In September 2022, the Washington Department of Revenue (DOR) found advertising agency tax payers did not establish that advancements and reimbursements were excluded for excise and sales and use tax purposes. The DOR’s Audit Division reviewed agency taxpayers’ accounts and issued balance-due notices. Taxpayers, advertising agency operators, protested, contending that they did not intend to […]

Cookie nexus’ does not constitute physical presence for Commerce Clause purposes in pre-Wayfair periods. In December 2022, the Massachusetts Supreme Judicial Court issued its ruling in U.S. Auto Parts Network, Inc. v. Commissioner concluding that the Commissioner of Revenue could not apply the new nexus rules instituted after Wayfair to apply sales tax retroactively to […]

PL 86-272 is a federal law enacted in 1959 that prohibits states from imposing a net income tax on income derived within the state by an interstate business if the business’ in-state business activities are limited to the solicitation of orders for sales of tangible personal property. Since 2018, when the U.S. Supreme Court overruled […]