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Showing posts from August, 2013

Sales Tax on Computer Design, Software Modification Services: Massachusetts Issues Initial Guidance, Yet Questions and Challenges Remain

On Wednesday, July 24 th  Massachusetts enacted  H.B. 3535 ,  An Act Relative to Transportation Finance  (“the Act”), which was passed by legislative override of Governor Deval Patrick’s veto.  The Act includes several significant tax provisions, such as the adoption of market-based sourcing for receipts from other than tangible personal property sales and an increase in the cigarette tax. But perhaps the most significant tax provision in the Act is the expansion of the sales tax base to include Computer System Design and Software Modification Services. Because this provision became effective on July 31, 2013 (just seven days after the enactment of H.B. 3535) businesses that provide computer system design and software modification services will not have much time to digest the new provision’s impact and implement procedures to insure they are compliant with the new law's requirements. Perhaps this is reason the Massachusetts Department of Revenue issued preliminary ad