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Alabama DOR Withdraws Amendment to Tax Digital Transmissions

author photo of Ned Lenhart

In a previous blog entry I noted that the Alabama Department of Revenue had proposed an amendment to Regulation 810-6-5 to expand the tax base of the Alabama rental tax to a wide variety of digital products, which could have included SaaS and other remote access software.

However (in July), the Alabama reconsidered its proposed regulation and withdrew from further consideration. Pressure came from both the business and legislative communities as they argued that this type of expansion should come through the legislature and not be done via administrative means.

As more states continue to evaluate creative ways to tax SaaS and digital transmissions, this issue may resurface in Alabama in the near future.

Ned Lenhart

Ned Lenhart, CPA is the founder and President of Interstate Tax Strategies, P.C. (“ITS”). Ned has over 28 years of varied state tax consulting experience including roles as the Director of Compliance for the Missouri Department of Revenue, SALT Manager for Arthur Andersen in Kansas City, and Director with Deloitte in their Atlanta office from 1994 to 2003. He started ITS in 2003 to assist local and national companies by helping them develop proactive strategies to managing their multi-state sales tax obligations.

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