iTunes Tax Technically Corrected
Posted on May 19, 2008 at 7:26 amThe Tennessee Journal reports that now that the technical corrections bill has passed the legislature we may never know if the somewhat tortured interpretation of Tennessee annotated code that the Department of Revenue has been using to collect tax on digital downloads of books, music and movies would have held up to a serious challenge:
Several other sections of the technical corrections bill were withdrawn, including one to force motels that don’t have restaurants to remit sales tax on continental breakfasts served to their guests.
One that stayed in the bill — which both the House and Senate passed Thursday — clarifies that digitally downloaded music, books, and videos are subject to the sales tax. Through complicated interpretations of law, the state used to treat such products for sales tax purposes as tangible personal property. A provision of the streamlined sales tax law that took effect Jan. 1 made the matter simpler, according to the department, though a private-letter ruling it issued in March, and then rescinded, declared the products not subject to the tax. The American Electronics Association last week disputed the department’s contention the downloads are taxable. Revenue Commissioner Reagan Farr said that, absent the bill, he expected a legal challenge from Microsoft.
SEE ALSO: Terry Frank
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The FONCE Is Dead
Posted on May 14, 2008 at 7:00 pmFifteen million dollars worth of “technical correction” just went out the window according to John Rodgers:
The provision would have eliminated a tax break for commercial real estate holdings of Family Owned Non-Corporate Entities, or FONCEs. A limited liability company is a non-corporate entity.
Business lobbyists and some like-minded lawmakers have targeted that section of the Bredesen administration’s so-called “technical corrections bill,” saying it would be a tax increase on some small businesses.
The administration says it would only hurt wealthy families.
But apparently the business lobby won the fight as the provision was taken out of the technical corrections bill today.
SEE ALSO: Whitehouse on FONCE
Tom Humphrey
WPLN
Andy Sher
Distressed Over Tax Credits
Posted on April 28, 2008 at 10:09 amStacey Campfield is wary of a tax credit of businesses in economic distressed neighborhoods contained in this year’s “technical corrections bill“:
While I generally support lowering taxes, this seems like it could be ripe for abuse. I wonder how “economically distressed” is defined. Why should some counties get an unfair advantage over other counties? This does not seem like a bill that benefits the entire state or has state wide applications. Shouldn’t the county set up the tax break if that is what their constituents want? It is like if the federal government said “We are giving tax credits if you start a small business in Georgia.” All well and good for Georgia but is that fair for Tennessee? Why is one employer more special than another? If they employ some one who needs a job no matter where they live don’t they deserve credit?
MORE:
Ben Cunningham
Martin Kennedy
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Fool Me Once…
Posted on April 25, 2008 at 6:23 pmOne of the interesting things that came out of yesterday’s iTunes tax revelation was that it was also revealed to a wider audience that the Department of Revenue apparently shares drafts of the “technical corrections bill” with a few good tax attorneys before sending it on to the legislature.
Bill Hobbs, for one, is not depending on one of those lawyers springing a leak again next year like it did this year:
A simple open-records request for copies of the draft should suffice next year to short-circuit the Revenue Department’s plan to craft new tax policy under the watchful eye of only a few hand-picked tax attorneys.
Tax policy proposals should be crafted in out in the open, where the public - who, after all, pay the taxes - can see what is happening.
VERY Preliminary
Posted on April 23, 2008 at 10:28 amInstapundit a snippet from a Waller, Lansden, Dortch & Davis on a rough draft of the Department of Revenue’s “technical correction bill.”
Each year, late in the Tennessee legislative session, the Administration and the Tennessee Department of Revenue (TDOR) release what they call the Technical Corrections Bill. The Bill typically contains multiple targeted changes to state tax law, some small and some not so small, depending on whether you are in the cross-hairs of the bill. The Bill is scheduled to be released later this week (or next). A preliminary draft includes proposed changes with significant potential impact on businesses in Tennessee. Please note that the draft is touted as “VERY preliminary” and states that “many sections will need to be revised and/or added before the amendment is finalized.”
Read the whole thing for discussion of the digital media tax.
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