Of Counsel Mike Semes recently authored an article for Tax Notes titled “Does It Make Sense That SaaS Is Perceptible to the Senses?”
The July 10, 2023, article examines the Arizona Court of Appeals’ decision in ADP LLC v. Arizona Department of Revenue. The court “held that ADP’s rental of its eTime application software was subject to transaction privilege tax (TPT) because eTime was ‘tangible personal property’ (TPP) as defined in the TPT statute,” he writes.
“Astonishingly, the court reached its conclusion by analogizing ADP’s use of eTime to playing a record in a jukebox and using a coin-operated washing machine – which were held to be subject to TPT in 1943 and 1970, respectively. Yes, that’s 80 and 53 years ago,” he adds.
Read the article (subscription required).