TWIST - May 24, 2021

Welcome to TWIST for the week of May 24th, featuring Sarah McGahan from the Washington National Tax State and Local Tax practice.

First up, Senate Bill 153, which is pending signature in Missouri would make several changes to Missouri’s sales and use tax code. One of the more significant changes is the adoption of an economic nexus threshold effective January 1, 2023. The bill would require both remote sellers and marketplace facilitators to collect and remit sales taxes. Currently, Missouri is the only state that has not updated its sales and use tax nexus standard post-Wayfair.

In Indiana, the tax court held that the Department of Revenue failed to establish that a taxpayer was selling tangible personal property and was therefore required to use the corporate income tax sourcing rules for such sales. After reviewing the evidence, the tax court ultimately ruled that the Department was not entitled to summary judgment. However, the court found that the evidence presented by the taxpayer and lack of adequate rebuttal by the Department entitled the taxpayer to summary judgment as a matter of law.

Finally, the Nevada Supreme Court held that a Nevada bill that repealed a previously legislated reduction of the Modified Business Tax or MBT rate was unconstitutionally enacted because it did not receive a 2/3 vote in each chamber. Under Nevada law, a 2/3 vote of each chamber is required to pass any bill that increases taxes.  Although the plaintiffs argued that the bill did not increase taxes because it maintained the existing higher MBT rates, the court determined that but for the law, the state would have not generated almost $100 million of public revenue and therefore the legislation increased taxes. 

Thank you for listening to TWIST and stay well.