Tax Report - Bradley

Code of Ethics . . . . . . . . . . . . . . . . . . . . . . . . . 2President’s Corner . . . . . . . . . . . . . . . . . . . . . . 336th Annual Conference . . . . . . . . . . . . . . . . . . 3Counsel’s Corner . . . . . . . . . . . . . . . . . . . . . . . 4

CMI Candidate Connection . . . . . . . . . . . . . . 20CMI Corner . . . . . . . . . . . . . . . . . . . . . . . . . . . 20ABA/IPT Advanced Tax Seminars . . . . . . . . . 21Intermediate Real Property Tax School . . . . . 22

Property Tax Calendar . . . . . . . . . . . . . . . . . . 22Career Opportunities . . . . . . . . . . . . . . . . . . . 23Calendar of Events . . . . . . . . . . . . . . . . . . . . . 24

In this Issue

Global Procurement and VAT PitfallsIn order to further reduce production and operating costs, US multinationals are moving from country-specific procurement contracts to global procurement contracts. However, global procurement contracts are rife with VAT pitfalls and must be carefully reviewed to eliminate unrecoverable VAT costs.Kenneth W. Helms, CMISenior Manager – Global Indirect TaxesTax Trilogy, LLCDearborn, MIPhone: 313.827.4100Email: [email protected]

Dee Adewunmi, LLMManager – Global Indirect TaxesTax Trilogy, LLCDearborn, MIPhone: 408.375.1070Email: [email protected]

Article begins on page 12

Value Added Tax

Tax ReportInstitute for Professionals in TaxationExcellence Through Tax EducationFebruary 2012

April 22 - 27, 2012 ~ Sales Tax School II Theory & Practice for the Experienced Sales & Use Tax Professional

Marriott Kingsgate, University of Cincinnati, Cincinnati, OhioRegistration form Hotel reservations View program

Washington Supreme Court Dodges the Question of Retroactively Applied Taxes…for NowThe authors describe a recent Washington Supreme Court decision denying a taxpayer a B&O manufacturing tax deduction based on the plain meaning of the statute—after the lower appellate court found that the statute’s plain meaning made the deduction available. The court pointedly avoided the lower court’s ruling that a retroactive amendment adopting the Department of Revenue’s position violated Due Process constraints. That leaves the favorable retroactivity jurisprudence in place, just in time for the court to be confronted with another case in which the state legislature has attempted to retroactively reverse, with 27-year backward-looking effect, a state supreme court ruling in another B&O tax matter.Michelle E. DeLappe, Esq.Norman J. Bruns, Esq.Garvey Schubert BarerSeattle, WAPhone: 206.464.3939Email: [email protected]: [email protected]


Income Tax

Alabama Corporate Taxpayers and CPAs Beware: House Bill Targets Unitary Combined Reporting, the Section 199 Deduction and Bonus DepreciationAlabama corporate taxpayers beware - mandatory unitary combined reporting has been re-introduced in the 2012 regular session. The bill adopts the MTC’s definition of a unitary business, but leaves the majority of the return requirements up to the Department of Revenue. In addition, the bill would also limit the Domestic Production Activities Deduction under IRC Section 199 to 3% and would limit any bonus depreciation deductions to 50% - retroactively, for all tax years beginning on or after January 1, 2012.Bruce P. Ely, Esq. and James E. Long, Jr., Esq.Bradley Arant Boult Cummings LLPBirmingham, ALEmail: [email protected]: 205.521.8366Email: [email protected]: 205.521.8626


Income Tax

mailto:[email protected]






IPT February 2012 Tax Report 2

IPT OffIcers: President Linda A. falcone, cMI Ryan, LLC

first Vice President Paul A. Wilke, cMI Weingarten Realty Investors

second Vice President Arlene M. Klika, cMI Schneider National, Inc .

IPT BOArd Of GOVernOrs: Immediate Past President robert d. Butterbaugh, cMI Ernst & Young LLP

Kyle caruthers The Coca-Cola Company

Gwendolyn s. evans, cMI Raytheon Company

christopher s. Hall, cMI, cMA Ford Motor Company

donna L. Jernigan, cMI, Pe Exxon Mobil Corporation

Kenneth r. Marsh, cMI TransCanada Pipelines Limited

William J. Mcconnell, cMI, cPA, esq. General Electric Company

chris G. Muntifering, cMI General Mills, Inc .

Kellianne M. nagy, cMI, cAe Time Warner Cable

Andrew P. Wagner, esq., cPA FedEx Corporate Services

GenerAL cOunseL: edward Kliewer, III, esq. Fulbright & Jaworski L .L .P .

execuTIVe dIrecTOr: Billy d. cook

dePuTy execuTIVe dIrecTOr and sTATe TAx cOunseL: cass d. Vickers, cMI, esq.

AssIsTAnT execuTIVe dIrecTOrs: Brenda A. Pittler charles Lane O’connor

This publication is designed to provide accurate information for IPT members and other tax profes-sionals . However, the Institute is not engaged in rendering legal, accounting, or other professional services . If legal advice or other expert assistance is required, the services of a competent profession-al should be sought . Reprint permission for articles must be granted by authors and the Institute . Send address changes and inquiries to Institute for Pro-fessionals in Taxation, 1200 Abernathy Road, North-east, Building 600 Suite L-2, Atlanta, Georgia 30328 Telephone (404) 240-2300 . Fax (404) 240-2315 .

Sales and Use Tax

CODE OF ETHICS: CANON 17

IT IS UNETHICAL in any representation of fact to IPT, in a membership application, renewal form, or otherwise, to knowingly furnish inaccurate, deceitful, or misleading in-formation, or to knowingly withhold material information.

The Utility Services Sales Tax Base in New JerseyAtlantic City Showboat, Inc. v. Dir., Div. of Taxation

The New Jersey Tax Court has rendered a decision sweeping into the tax base for “utility services” virtually all charges associated with the provision of electric power to customers. Included are local public utility charges for distribution, authorized charges for the recovery of costs associated with the transition from the prior regulated monopoly regime (such as various stranded plant and supply purchase contracts and nuclear plant decommissioning costs), and administrative costs such as metering and billing. The opinion treats receipts from all such charges as part of what the customer pays for electricity. In that and other contexts, this broad approach to the taxation of services collides with the traditional limitation of sales tax to services that are specifically enumerated in the governing tax code.Cass D. Vickers, CMI, Esq.IPT Deputy Executive Director and State Tax CounselAtlanta, GAPhone: [email protected]


Have you joined IPT’s discussion group on LinkedIn? Click the logo, join the group IPT Institute for Professionals in Taxation, and start a discussion.

Credits and Incentives

Credits and Incentives Trends: More States Target Data Center Investments with Specific Sales Tax ProgramsIn an increasingly digital world, particularly with the advent of cloud computing, data management has become a hot topic for businesses with data intensive operations. Tax incentives can play a key role in differentiating potential facility locations for data centers, and many states have established sales tax incentives specific to data centers.Christine Bustamante KPMG LLPColumbus, OHPhone: 614.249.1922Email: [email protected]

Tony BoettoKPMG LLPColumbus, OHPhone: 614.249.2308Email: [email protected]






President’s

Corner

The next meeting of the Institute’s Board of Governors is scheduled for March 17th in Dallas. The primary focus of this meeting is the 2012 budget. The Board of Governors listens very carefully to your suggestions and program evaluations. These suggestions are folded into the budget review process as we continuously work to identify the membership’s ever-changing needs and formulate programs and services to meet those needs. Please let us know if you have any suggestions on how we may better serve you.

The Institute’s 2012 Sales Tax School I will be upon us shortly. The school is scheduled for February 26th - March 2nd. To date, over 210 business tax professionals have registered representing over 125 companies. I would like to express the Institute’s appreciation to School Chair, Brenda S. Kelly, CMI, CPA, and Vice Chair, Kathy Peavley, CMI along with their instructors,

for their participation in this program. Without the commitment and dedication of these volunteers, IPT could not continue to maintain this high-quality school.

The IPT/ABA Joint Tax Seminars will occur from March 19 through March 23, in New Orleans. Detailed program information is on IPT’s website. Participants must register directly with the ABA Section of Taxation either online or by submitting the registration form available on the IPT website. Don’t miss three of some of the best educational offerings of 2012.

Registration also continues for Sales Tax School II and the Intermediate Real Property Tax School. We expect good turnouts for these courses, which are being offered April 22 - 27, and April 29 - May 4 respectively, in Cincinnati, Ohio.

This year, IPT celebrates its 36th year, and the Annual Conference will allow you the opportunity to learn from your peers, socialize with colleagues, and interact with others experiencing similar industry issues. We hope you will invest in your professional development and join us June 24-27, 2012 in Indian Wells, California.

Finally, as a reminder, CMI exam dates are scheduled in conjunction with the June Annual Conference and the fall Symposia. Any qualified member interested in sitting for the CMI examination prior to the Annual Conference must submit their candidacy application by March 21st. Please visit IPT’s website for applications and further information.

Thank you, again, for your membership in the Institute. It is through your membership support and participation that the Institute is able to accomplish what it has. If you have any questions, concerns or recommendations, please do not hesitate to contact me directly.

Linda A. Falcone, CMI President

Linda A. Falcone, CMIPresident June 2011-2012

36th Annual Conference Renaissance Esmeralda Resort

Indian Wells, California June 24 - 27, 2012

Registration will begin in Mid-March.

Click here to make your hotel reservation.


Washington Supreme Court Dodges the Question of Retroactively Applied Taxes…for NowMichelle E. DeLappe, Esq.Norman J. Bruns, Esq.Garvey Schubert BarerSeattle, WAPhone: [email protected]@gsblaw.com

Retroactive legislation that attempts to limit taxpayers’ refund rights tests the boundaries of the constitutional right to due process of law.

This is an issue of great interest around the nation, where many state legislatures are turning every stone for opportunities to raise revenues. Though often petitioned to review state cases on retroactive taxes, the U.S. Supreme Court has refused to provide further guidance in this area—most recently in its January 23 denial of certiorari in General Motors Corp. v. Dep’t of Treasury. In grappling to discern what due process limits apply to retroactive economic legislation, court decisions’ influence can extend to other states’ courts and legislatures. So attention should be paid to decisions emanating from any court on this issue.

In January of this year, Washington State’s highest court showed its determination to avoid the question entirely in Tesoro Refining & Marketing Co. v. Department of Revenue. But the Washington Supreme Court likely will not succeed in avoiding this issue for long. Another Washington taxpayer, Dot Foods, Inc., is challenging an even more grievous instance of retroactive legislation in trial court now. We expect Dot Foods’ case will reach Washington Supreme Court review on precisely this issue.

The Tesoro case involved a tax refund claim by Tesoro

Counsel’sCorner

Income Tax

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Refining & Marketing Company, which operates an oil refinery in Anacortes, Washington. A little overview of Washington’s tax structure is in order to understand the case. Instead of imposing income tax, Washington taxes the “privilege of doing business” in Washington by imposing the business and occupation (“B&O”) tax. The B&O tax has a pyramid structure. For example, the tax applies throughout the chain of distribution, including each level of manufacturing, wholesaling, and retailing activity. Thus, the B&O tax can apply several times to the same product as it travels through the distribution chain. A single taxpayer engaged in more than one activity, however, can apply a multiple activities tax credit to reduce the impact on the multiple activities. In Tesoro’s case, the taxpayer both manufactured and sold bunker fuel. The multiple activities tax credit reduced the tax attributable to sales of the bunker fuel, so Tesoro paid the tax attributable to the manufacturing activity. Up to this point, everyone agrees that Tesoro did everything right.

The dispute arose with a special deduction that Tesoro argued was applicable to some of its remaining taxable income. The deduction applies specifically to amounts received in sales of bunker fuel for consumption in international commerce. Everyone agrees that Tesoro made qualifying sales of bunker fuel, but the tricky part was that Tesoro not only sold the fuel but manufactured it as well. Thus, because of how the multiple activities tax credit works, the remaining taxable income was deemed to be Tesoro’s manufacturing income, not wholesaling or retailing income. Given that manufacturing income is also measured by sales, other taxpayers identically situated to Tesoro took the special deduction. But Tesoro, which was new to Washington, did not know about the deduction until years later. When Tesoro eventually claimed a refund based on the deduction, the claimed amount was apparently enough to give the Department of Revenue pause. Initially $2.5 million, the refund claim grew to over $6.6 million during the course of appeals due to Tesoro’s ongoing payment of taxes for additional years. Facing this large refund possibility, the legislature enacted an amendment “clarifying” that the deduction was only meant to apply to wholesaling and retailing activities, not manufacturing. The amendment stated that it “applies both prospectively and retroactively.” The governor signed the amendment into law on the eve of the hearing for summary judgment in Tesoro’s case.

Upon losing on summary judgment, Tesoro appealed. The state’s Court of Appeals, in Tesoro Refining & Marketing Co. v. Department of Revenue, 159 Wn. App.104, 246 P.3d 211 (2010), determined that the plain language of the deduction statute before the amendment allowed taxpayers to take the deduction against manufacturing income as that income is measured by sales. Accordingly, the Court concluded




that the new amendment resulted in a real change, not a mere clarification. A factor that influenced the Court in this conclusion was the fact that the Department of Revenue had allowed other refiners the same deduction. The Court of Appeals also held that the legislature’s attempt to limit the deduction retroactively violated due process because the amendment was not a clarifying measure and was not retroactively applicable for a “modest” period of time. Retroactively applying the amendment for the deduction’s full 24-year history was simply too long.

Next, it was the Department of Revenue’s turn to appeal. This time, three amici curiae, one of which was IPT (see here), submitted briefs focused on the retroactivity issue. It seems these friends of the court had an impact: Instead of issuing a decision approving the legislature’s conduct in enacting a retroactive amendment, the Washington Supreme Court avoided the question altogether. The decision relegated the entire issue of retroactivity to a mere footnote in the decision, stating that the Court need not reach that issue. The only way to avoid the issue of retroactivity was to have Tesoro lose on the basis of statutory interpretation. Whereas the Court of Appeals concluded that the plain language of the statute allowed the deduction to apply to manufacturing, the Supreme Court held that the plain language of the statute precluded applying the deduction to manufacturing. The two appellate courts thus reached opposite interpretations based on supposedly “plain” language.

The silver lining in all this for taxpayers in general is that the Supreme Court, by making no comment on the Court of Appeals’ retroactivity analysis, appears to leave that analysis intact as good law with respect to retroactivity. At the very least, the Court of Appeals’ rejection of long periods of retroactive imposition of taxes still stands as persuasive authority.

That authority on retroactivity may come in handy for another taxpayer very soon. As explained in IPT’s amicus brief in the Tesoro case, the Washington Supreme Court issued a favorable B&O tax decision in Dot Foods, Inc. v. Department of Revenue, 166 Wn.2d 912, 215 P.3d 185 (2009), based on the plain language of a statute, only to have the legislature promptly take that relief away by enacting an amendment leading to the opposite result. The amendment adopted the Department of Revenue’s interpretation in the case. And once again, the legislature said this was a clarification applying retroactively to the statute’s original enactment date. The statute had been promulgated 27 years earlier. The amendment carved out a sole exception to its retroactive application: Dot Foods would receive the benefit of the Supreme Court’s ruling, but only for the years subject to the appeal before the Supreme Court. For later years, Dot Foods enjoys no exception. Hence,

Dot Foods finds itself once again in court, but this time on the issue of retroactivity.

The Dot Foods case is an even more extreme case of the legislature’s pushing the bounds of due process than Tesoro was. In Dot Foods, the legislature has effectively attempted to reverse the Court by saying that now the law retroactively means the exact opposite of what the Court had ruled it meant. Narrowly carving out the taxpayer and years involved in the Supreme Court’s decision shows no respect for the Court’s interpretation of what that law meant all along. Indeed, by applying the law differently to different taxpayers for the very same years, the legislature’s retroactive application of its amendment goes even further in offending the principle of uniform and equitable administration of taxes than was the case in Tesoro.

Because the Supreme Court in Tesoro made no comment whatsoever on the Court of Appeals’ retroactivity analysis, there remains a potential for the continuing vitality of that firm rejection of overreaching in imposing taxes far into the past. The Court of Appeals decision was essentially “reversed on other grounds,” which should mean it is still good law. Given the high likelihood of Dot Foods once again reaching the Supreme Court, this time on the retroactivity issue, the Supreme Court will likely soon find itself obliged to face the very issue it so carefully avoided in Tesoro, and this time with even more clear-cut facts.

Income Tax

Alabama Corporate Taxpayers and CPAs Beware: House Bill Targets Unitary Combined Reporting, the Section 199 Deduction and Bonus DepreciationBruce P. Ely, Esq. and James E. Long, Jr., Esq.Bradley Arant Boult Cummings LLPBirmingham, ALEmail: [email protected]: 205.521.8366Email: [email protected]: 205.521.8626

On February 7, the first day of the Alabama Legislature’s 2012 regular session, Representative Richard Lindsey (D-Cherokee, Cleburne, and DeKalb Counties) introduced a lengthy bill of significant interest to Alabama corporate income taxpayers. House Bill 199 would limit the Domestic Production

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Activities Deduction (“DPAD”) under IRC Section 199, partially decouple from the 100% bonus depreciation provisions enacted by Congress in 2010, and mandate combined reporting (“MUCR”) for certain unitary business entities. HB 199 has been assigned to the House Ways and Means-Education Committee, and is essentially a combination of three bills sponsored by Rep. Lindsey during the 2011 regular session (HB 299 through 301). It is likely that, as in past years, the Alabama Education Association teachers union is advocating these proposals. A summary of each major provision of HB 199 is provided below.

Imposition of MUCR

Similar to the proposals introduced in the 2008, 2009 and 2011 legislative sessions, this bill would require the Commissioner of the Alabama Department of Revenue to impose mandatory unitary combined reporting “when an Alabama taxpayer is part of a unitary business consisting of multiple business entities.” The bill essentially adopts the Multistate Tax Commission’s familiar and broad definition of a “unitary business,” as contained in its Model Combined Reporting Act. In addition, the bill provides that the term “unitary business” shall be interpreted as broadly as possible, limited only by the bounds of the U.S. Constitution, as a backstop to the MTC definition.

The combined report must include all members of the unitary group doing business in the United States or commercially domiciled in foreign “tax havens.” The bill does not provide any qualitative requirement for a foreign entity’s activities within the United States as compared to its activities abroad. Apparently, simply maintaining a commercial domicile in a disfavored country will subject the entity’s income to apportionment by Alabama via a combined return, which is a constitutionally suspect provision.

The combined group of business entities would apportion their total income to Alabama using the group’s Alabama “source apportionment data relative to the combined group’s apportionment data from all sources.” The remaining details and mechanics of the unitary report must be promulgated by the Department of Revenue through regulations.

Perhaps the most frightening feature of this bill is its lack of detail. The bill is silent regarding the calculation of tax liability, the impact on credits and other tax attributes by the unitary group’s members, the effect on Alabama’s existing consolidated return filing regime (the bill does not propose any amendments to this section), and whether it could apply to the current tax period. The bill is also silent with respect to any equity ownership requirement or threshold for inclusion in the Alabama combined group, which is a deviation from

the vast majority of state combined reporting schemes that typically require a 50% threshold equity interest before an entity is included in the combined group.

Additionally, taxpayers do not appear to have the option to elect unitary combined reporting, which is a fundamentally unfair result. Interestingly, the proposed bill would require combined reporting without repealing or amending Alabama Code section 40-18-39(i), which expressly prohibits unitary combined reporting, either forced or elective.

Limitation of the DPAD

Alabama levies an income tax on all corporations doing business within the State, and the tax base is tied directly to the federal definition of “taxable income.” One deduction that is currently allowed to taxpayers in determining their federal taxable income is the IRC Section 199 DPAD, which is equal to 9% of the lesser of the taxpayer’s qualified production activities income or its taxable income. Currently only “C” corporations doing business in Alabama can claim the Alabama equivalent deduction. This bill would limit an Alabama corporate taxpayer’s DPAD to one-third of its federal DPAD by requiring them to add-back any amount deducted in accordance with IRC Section 199 in excess of 3% of the lesser of qualified production activities income or taxable income. This provision would apply retroactively to all tax years beginning on or after January 1, 2011.

Preemptive Decoupling from Bonus Depreciation

Another deduction currently available to Alabama taxpayers by virtue of the link to federal “taxable income” is the temporary 100% bonus depreciation deduction for qualified property granted by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (P.L. 111-312). While the 100% bonus depreciation allowed under the Tax Relief Act is scheduled to expire in 2012, in the event that Congress enacts a similar provision this year, the bill would limit the depreciation to 50% by requiring taxpayers to add-back in the amount deducted in accordance with IRC section 168 that is in excess of 50% of the adjusted basis of qualified property. This provision of the bill would also apply retroactively to all tax years beginning on or after January 1, 2012.

Interestingly, the expected increase in revenue from these three proposals would be used to provide a four percent cost-of-living salary increase for certain state and public education employees (introduced as HB 183).

©February 2012. Bruce P. Ely/James E. Long, Jr./Bradley Arant Boult Cummings LLP.


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Credits and Incentives Trends: More States Target Data Center Investments with Specific Sales Tax ProgramsChristine Bustamante KPMG LLPColumbus, OHPhone: 614.249.1922Email: [email protected]

Tony BoettoKPMG LLPColumbus, OHPhone: 614.249.2308Email: [email protected]

I n an increasingly digital world, particularly with the advent of cloud computing, data management has become a hot topic for businesses with data intensive

operations. Many large corporations are reviewing how and where they store data and are making significant investments to upgrade and modernize their data centers. Investments in data center facilities allow businesses to reduce operational risk and reduce long-term costs in an increasingly competitive economic climate. As businesses consider these initiatives, tax incentives can play a key role in differentiating potential facility locations.

Large data center projects can involve over $1 billion in capital investment up front and significant equipment refresh costs on an ongoing basis. These projects do not typically involve significant direct job creation. Traditionally, state and local incentive programs have valued job creation over investment, but even with a relatively low number of new jobs, states recognize the tremendous economic impact to landing such a project.1

In 2011, Dell Corporation provided an example of cloud computing driving data center strategy. An article

1 InformationWeek quoted Washington State Representative Timm Ormsby, as saying “This legislation creates a window of op-portunity to stimulate the economy in the short term with hundreds of badly needed construction jobs in Eastern Washington and, by restarting data center development in this state, to generate long-term high tech jobs and spur additional technology investment.” Bob Evans, Global CIO: Data Centers Behaving Boldly: Meet Tech’s New Rock Stars, InformatIonWeek, Feb. 1, 2010, http://www.information-week.com/news/global-cio/security/222600578?pgno=2. The report indicated, “[d]ata centers usually create up to 500 or more construc-tion jobs, in addition to the 30 to 50 permanent operating jobs.” Id.

published by data center rack supplier Rack Solutions reads, “According to Dell, the cloud computing industry is growing fast, and the company is moving quickly to develop new data centers that can support the global demand for secure, cloud services.” 2 Subsequently, in an April press release, Dell announced that it will open 12 Global Solution Centers within a year and an additional 10 more over the next 18 months.3 The total investment in the centers is expected to be over $1 billion, and it can be expected that state and local agencies will aggressively attempt to convince Dell that they are the right place for a data center with tax incentives.

Data Center Location Considerations

While tax incentives play a role in data center site selection, businesses with data center projects will typically consider locations that are most in line with strategic priorities. These priorities tend to address operational risk and long-term costs.

Managing operational risks related to capacity, reliability, and security is a key strategic priority for many data center projects. Where a data center is located can have a significant impact on the operational risk of a facility. Many locations prone to seismic, tornado, or hurricane activity are considered unacceptable. Additionally, areas with a strong record of electric utility service reliability can be considered favorable.

Major cost considerations for a data center facility may include cost and availability of electricity, personal property taxes, and sales taxes on data processing equipment.

Electricity costs are determined by an unpredictable market and a number of factors impacting utility companies. Short listed locations for data center site selections tend to have low electricity rates and strong utility incentives. However, some uncertainty will exist about the cost of electricity over an extended period of time regardless of what location is selected.

Statutory personal property tax exemptions are available for new personal property in many states, and many

2 Dell Planning Major Investments in New Data Centers, rack-SolutIonS, Mar. 29, 2011, http://www.racksolutions.com/news/data-center-trends/dell-planning-major-investments-in-new-data-centers/.

3 See Press Release, Dell, Inc., Dell Invests $1 Billion in Tech-nology Solutions and Services to Help Customers Drive Business Results Today and in the Future (Apr. 7, 2011), http://content.dell.com/us/en/corp/d/press-releases/2011-04-07-dell-invests-solutions-services.

Credits and Incentives




others are able to offer full or partial personal property tax abatement for a number of years. These locations are natural places for data centers to look for a cost effective location. States without personal property tax abatement may have a difficult time competing from a cost perspective for a capital intensive data center project.

When it comes to sales tax, some states are able to offer general exemptions as an incentive,4 and some states are able to provide an exemption through bond financing lease-purchase arrangements with a public or non-profit organization.5 These programs can limit the value of an exemption, complicate the transaction, or increase up-front costs to a business.6

Specific Data Center Sales Tax Exemptions

Recently, many states have established specific sales tax abatements and exemptions for data centers. These programs provide transparent sales tax relief to data centers over an extended period of time, and show that states are serious when they label data center projects a strategic priority.

A brief description of the program qualifications and benefits for some key states offering specific data center exemptions is listed below.

4 There is no sales tax levied in Alaska, Delaware, Montana, New Hampshire, and Oregon. Examples of states with sales tax ex-emption programs that could apply to data centers but do not specifi-cally target data centers include Texas and Kentucky. In Texas, the Texas Enterprise Zone program provides limited sales tax exemptions that would cover data center equipment. See tex. Gov’t code ann. §§ 2303.504(a)(1), 2303.505(a) (West 2011). In Kentucky, the Ken-tucky Enterprise Initiative Act program provides discretionary sales tax exemptions for construction materials and electronic processing equipment. See ky. rev. Stat. ann. § 139.535(2) (West 2011). Other programs in other states may be available.

5 Kansas is an example of a state that offers sales tax exemp-tions through a lease-purchase agreement using revenue bonds. See, e.g., http://cityofmaize.org/irb.php, http://www.wichita.gov/Cit-yOffices/Urban/EconomicDevelopment/IRB/IRBOverview.htm

6 Both the Texas Enterprise Zone and the Kentucky Enterprise Initiative Act programs have annual limitations on funding amounts or number of projects allowed. Bond financing arrangements could involve significant bond counsel fees and impact the project timeline. See tex. Gov’t code ann. § 2303.403 (West 2011), ky. rev. Stat. ann. § 154.31-020(1) (West 2011).

North Carolina

For qualifying data centers7 in one of North Carolina’s economically distressed counties,8 certain machinery and equipment are exempt from sales tax.9 Instead a privilege tax is imposed equal to 1% of the eligible equipment cost up to a maximum of $80 per article.10 The North Carolina privilege tax, and the sales and use tax exemption for data centers, expires June 30, 2015.11

If the location qualifies as an “eligible internet data center,”12 it is not subject to the privilege tax. It also may qualify for exemption for certain equipment, software, and electricity used to provide the internet datacenter services.13 The internet data center designation requires that the facility be used primarily by a business engaged in software publishing or an internet activity.14 To qualify, the data center must be located in a designated economically disadvantaged county and the taxpayer must invest at least $250 million over a five-year period in real property or eligible business property.15

7 Under North Carolina law, a “data center” is a facility that “provides infrastructure for hosting or data processing services and that has power and cooling systems that are created and maintained to be concurrently maintainable and to include redun-dant capacity components and multiple distribution paths serving the computer equipment at the facility.” n.c. Gen. Stat. ann. § 105-164.3(5c) (West 2010). To qualify for exemption, a datacen-ter must meet certain requirements regarding the amount of the investment (ranging from $150 million to $225 million, depend-ing on the economic status of the area where the datacenter is located), wages and health insurance for employees. See n.c. Gen. Stat. ann. § 105-187.51C(a1) (West 2010).

8 See n.c. Gen. Stat. ann. § 105-187.51C(a1)(1) (West 2010).

9 See n.c. Gen. Stat. ann. §§ 105-164.13(5a), 105-187.51C. (West 2010).

10 See n.c. Gen. Stat. ann. § 105-187.51C (West 2010).

11 See n.c. Gen. Stat. ann. § 105-187.51C(d) (West 2010).

12 See n.c. Gen. Stat. ann. § 105-164.3(8e) (West 2010).

13 See n.c. Gen. Stat. ann. § 105-164.13(55) (West 2010).

14 See n.c. Gen. Stat. ann. § 105-164.3(8e)(a) (West 2010). Additional requirements may apply.

15 See n.c. Gen. Stat. ann. § 105-164.3(8e)(a), (c), (d) (West 2010).

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Minnesota

Minnesota has established a statutory sales tax exemption for qualified data centers16 effective for purchases made after June 30, 2012.17 The exemption applies to information technology (IT) equipment, computer software, and electricity purchased for a qualified data center operation.18

To be considered a qualified data center, a facility must be at least 30,000 square feet. The taxpayer must invest at least $50 million in construction and enterprise IT equipment and software within a 24-month period.19

Ohio

In 2011, Ohio enacted a law allowing a discretionary, full or partial sales and use tax exemption on data center equipment.20 To qualify for exemption, a data center project must apply and receive formal approval from the Ohio Tax Credit Authority prior to constructing the project.21 The tax credit authority has discretion to determine whether a facility qualifies as a computer data center22 and the rate of the credit.23 The definition of data center equipment is broad and includes equipment used to cool equipment used in a data center, equipment used to generate or transmit electricity used to operate a data center, and building and construction materials incorporated into a computer data center.24 The exemption also includes delivery, installation, or repair charges.25

16 See mInn. Stat. ann. § 297A.68, Subd. 42 (West 2011).

17 See mInn. Stat. ann. § 297A.68, Subd. 42(g) (West 2011).

18 See mInn. Stat. ann. § 297A.68, Subd. 42(a), (b) (West 2011).

19 See mInn. Stat. ann. § 297A.68, Subd. 42(c) (West 2011). Additional requirements apply.

20 See ohIo rev. code ann. § 122.175 (West 2011). The law became effective Sept. 29, 2011.

21 See ohIo rev. code ann. § 122.175(C)–(D) (West 2011).

22 See ohIo rev. code ann. § 122.175(A)(2) (West 2011).

23 See ohIo rev. code ann. § 122.175(B) (West 2011).

24 See ohIo rev. code ann. § 122.175(A)(4) (West 2011).

25 See ohIo rev. code ann. § 122.175(C) (West 2011).

To qualify for the exemption, a data center project must involve capital investment of at least $100 million over a three-year period.26 Additionally, the program requires annual payroll for employees at the computer data center to be at least $5 million.27 This exemption requires the filing of a direct payment permit with the Tax Commissioner28 and annual reporting on payroll and capital investment with the Ohio Tax Credit Authority.29 Wyoming

Wyoming implemented a data center sales tax exemption on the purchase or rental of software, hardware, electrical, and HVAC equipment for data center projects.30

To qualify for the exemption on software and hardware, a data center project must involve capital investment of at least $5 million.31 The exemption on software and hardware is available only in years during which the business spends over $2 million in such costs.32 For the exemption on electrical and HVAC equipment, the minimum investment threshold is $50 million.33 The exemption on electrical and HVAC equipment is also available only in years during which the business spends over $2 million in such costs.34 Iowa

Iowa offers an exemption and a refund of sales and use taxes paid by eligible data centers.35 The exemption applies to purchase or rental of most equipment used in

26 See ohIo rev. code ann. § 122.175(A)(5)(a) (West 2011).

27 See ohIo rev. code ann. § 122.175(A)(5)(b) (West 2011).

28 See ohIo rev. code ann. § 122.175(I) (West 2011).

29 See ohIo rev. code ann. § 122.175(E)(5) (West 2011).

30 See Wyo. Stat. ann. § 39-15-105(a)(viii)(S) (West 2011).

31 See Wyo. Stat. ann. § 39-15-105(a)(viii)(S)(III)(2)(a) (West 2011). The investment may be made in the future or in the five years preceding March 5, 2010.

32 See Wyo. Stat. ann. § 39-15-105(a)(viii)(S)(I) (West 2011).

33 See Wyo. Stat. ann. § 39-15-105(a)(viii)(S)(III)(2)(b) (West 2011). The investment may be made in the future or in the five years preceding April 1, 2011.

34 See Wyo. Stat. ann. § 39-15-105(a)(viii)(S)(II) (West 2011).

35 See IoWa code ann. §§ 423.3(95), 423.4(7) (West 2011).

Continued on page 10


the data center operation, whether directly or indirectly connected to the computers, including cooling and other temperature control systems and electricity or generator fuel.36 The exemption is available to data center projects in an Iowa location when the taxpayer invests at least $200 million (including land) within the first six years of operation in Iowa.37

For smaller projects with an investment of at least $5 million (including land) during the first six years of operation in Iowa,38 the state provides a refund of 50% of the state sales taxes paid for five to ten years, depending on the size of the capital investment, and whether the project involves new construction or rehabilitation of an existing structure. 39 Virginia

Virginia has a sales tax exemption on data center equipment and enabling software.40 To qualify for the exemption, a data center project in Virginia must involve $150 million in capital investment on or after January 1, 2009, and creation of 50 new full-time jobs paying 1.5 times the average wage of the community in which the data center is located.41 In areas with 150% of the average statewide unemployment rate or enterprise zones, the new job requirement drops to 25.42

36 See IoWa code ann. § 423.3(95)(a)(1)–(3) (West 2011).

37 See IoWa code ann. § 423.3(95)(b)(3) (West 2011). Ad-ditional requirements apply.

38 For sites at a rehabilitated building, the investment must be at least $5 million; for new construction sites, the investment must be at least $10 million. See IoWa code ann. § 423.4(7)(b)(2) (West 2011).

39 See IoWa code ann. §§ 423.4(7)(a)–(b), 423.4 (8)(c)(1)–(2) (West 2011). Note that the refund does not apply to local option sales and services taxes imposed under Iowa code chapter 423B. See IoWa code ann. § 423.4(7)(f) (West 2011).

40 See va. code ann. § 58.1-609.3(18) (West 2011). The exemption does not apply to computer software sold or leased separately from the computer equipment, nor general building improvements or other fixtures.

41 See va. code ann. § 58.1-609.3(18)(ii)–(iii) (West 2011).

42 See va. code ann. § 58.1-609.3(18) (West 2011). Average statewide unemployment rate for such year as determined by the Virginia Economic Development Partnership. Section 59.1-542 dis-

Prior to claiming an exemption, the taxpayer must enter into a memorandum of understanding with the Virginia Economic Development Partnership Authority that sets forth the commitments of the company with respect to job creation, investment, and project timing.43 Oklahoma

Oklahoma allows a statutory exemption on all machinery and equipment purchased by businesses primarily engaged in computer services and data processing.44 An eligible data center operation is required to earn at least 50% or 80% of its revenues from out-of-state customers depending on the SIC code of the business.45 The exemption requires filing of an annual affidavit with the Oklahoma Tax Commission to certify eligibility and affirm the percentage of the out-of-state sales. 46

Nebraska

Nebraska offers new and expanding businesses incentives primarily through its tiered Nebraska Advantage program, which provides a number of income, sales, withholding, and property tax incentives.47 The type and level of incentives vary depending on the size of the capital investment and the job creation associated with a project.48

For data center projects that create over 30 new full-time jobs with a capital investment of at least $3 million,49 or that have an investment of $30 million and

cusses enterprise zone designation. See Va. Code Ann. § 59.1-542 (West 2011).

43 See va. code ann. § 58.1-609.3(18) (West 2011).

44 See okla. Stat. Ann. tit. 68 § 1357(21) (West 2011).

45 See okla. Stat. Ann. tit. 68 § 1357(21) (a)–(b) (West 2011). SIC code 7374, (Computer Processing and Data Preparation and Processing Services), requires 80% out-of-state sales. SIC codes 7372 (Prepackaged Software) and 7373 (Computer Integrated Systems Design) requires 50% out-of-state sales. All sales to the federal government are considered to be to an out-of-state cus-tomer.

46 See okla. Stat. ann. tit. 68 § 1357(21) (West 2011).

47 See neb. rev. Stat. § 77-5725(2)(a), (8)(a) (2011).

48 See neb. rev. Stat. § 77-5725(1)(a)–(f) (2011).

49 See neb. rev. Stat. §77 -5725(1)(b) (2011).



maintain a constant level of jobs,50 all sales tax on capital purchases will be refunded to the business.51

Tennessee

Qualified data center equipment and software may be exempt from Tennessee sales tax as industrial machinery and equipment if used in a qualified data center.52 To qualify, a data center project must involve capital investment greater than $250 million and the creation of at least 25 new full-time jobs earning 150% of the state average occupational wage during a three-year period.53

Additionally, Tennessee has a reduced sales tax rate on electricity used to power a data center.54

Mississippi

Businesses in Mississippi that receive approval from the Mississippi Development Authority after July 1, 2010 are eligible for a sales and use tax exemption on purchases for a data center.55 The exemption is valid on purchase or lease of component building materials and equipment for initial construction or expansion of facilities. 56 An exemption is also available for the purchase of replacement hardware, software and all other technology necessary to operate the data center.57

To qualify, a company must invest at least $50 million and create 50 new full-time jobs earning 150% of the state average annual wage.58 Application and approval are required prior to beginning construction

50 See neb. rev. Stat. § 77-5725(1)(e) (2011).

51 See neb. rev. Stat. § 77-5725(8)(a) (2011). The property also is eligible to be exempt from personal property taxation for up to ten years. neb. rev. Stat. § 77-5725(8)(a), (c) (2011).

52 See tenn. code ann. §§ 67-6-206(a), 67-6-102(24), 67-6-102(46)(K) (West 2011).

53 See tenn. code ann. § 67-6-102(76) (West 2011).

54 See tenn. code ann. §67-6-206(c) (West 2011).

55 See mISS. code ann. §§ 57-113-21(d), 57-113-25(1) (West 2011).

56 See mISS. code ann. § 57-113-21(d)(i) (West 2011).

57 See mISS. code ann. § 57-113-21(d)(ii) (West 2011).

58 See mISS. code ann. § 57-113-21(a) (West 2011).

on a project.59 Each eligible project will be subject to the terms of an agreement with the Mississippi Development Authority.60

Alabama

Alabama allows for abatement of sales taxes associated with industrial property, which specifically includes data processing centers.61

To be considered eligible for the abatement, a new data center project must create 50 new jobs.62 Abatement is also available for existing data centers undergoing capital additions greater than or equal to the lesser of $2 million or 30 percent of the existing value of the property.63 The abatement would be available for up to ten years or the weighted average of the useful life of the equipment, whichever is less.64

Conclusion

While this article does not discuss all locations that are favorable for data center operations, it aims to provide examples of sales tax relief programs that specifically target data center projects. It is important to note that a number of other states have programs to provide sales tax relief to new or expanding businesses in general that may apply to data centers as well.65 More incentives for data centers can be expected to follow in the years to come.

The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

This article represents the views of the authors only, and does not necessarily represent the views or professional advice of KPMG LLP.

59 See mISS. code ann. § 57-113-23 (West 2011).

60 See mISS. code ann. § 57-113-25(3)(c) (West 2011).

61 See ala. code §§ 40-9B-4(a), (c), 40-9B-3(a)(9), (10)(g), (17), (18) (2011).

62 See ala. code § 40-9B-3(a)(4) (2011).

63 See ala. code § 40-9B-3(11) (2011).

64 See ala. code § 40-9B-3(a)(12)(a)–(b) (2011).

65 See supra notes 5 and 6 for examples.


Global Procurement and VAT PitfallsKenneth W. Helms, CMISenior Manager – Global Indirect TaxesTax Trilogy, LLCDearborn, MIPhone: 313.827.4100Email: [email protected]

Dee Adewunmi, LLMManager – Global Indirect TaxesTax Trilogy, LLCDearborn, MIPhone: 408.375.1070Email: [email protected]

In an effort to drive maximum value from the sup-ply chain, US multinationals are moving towards global procurement models. By “going global,” US

companies are foregoing procurement responsibilities based on business units, country or region of opera-tions. The new global-facing procurement agreements are being negotiated and entered into by the multi-national’s US TopCo/parent entity. However the pur-chase of goods and services under these agreements is made by several or all of the TopCo/parent entity’s subsidiaries. The supplier entity that is party to these global agreements may be either a US multinational or a non-US entity. Regardless of the supplier’s profile, global procurement creates a plethora of potential pit-falls for the purchaser.

Purpose of Global Procurement

The stated reasons for migrating to a global procure-ment function can be few or many. Ultimately, the pri-mary driver is the opportunity to identify, document, mitigate or eliminate costs of the current state versus the estimated costs of the proposed future state. The more obvious types of costs targeted may include:

Per piece volume discounts (single source •supplier or limited supplier base)Low cost raw materials•FTE (“Full Time Employee”) reductions due •to:

Redundant Procurement staff at each o business unit or Region

Redundant Payables staff at each o business unit or RegionImprovement in Procurement process o (elimination of manual workflow)Roll up of special purpose commodi-o ties into overall commodity Procure-ment group

Foreign exchange (“FX”) risk•

Other less obvious value drivers of centralized global procurement include:

Improvement of cash-flow via maximizing:•Just-in-time (“JIT”) inventory (shorten-o ing the time between paying for mate-rials/components and selling the final product)Material tolerances and overall quality o (mitigating the impact of non-conform-ing materials – both in size specifica-tions and material composition - to the production schedule)

Preferential tariff/import duty and tax treat-•ment

As always, the aggregate of these cost improvements becomes the comparative value against current state costs, systems improvement and internal disruptive costs. Unfortunately, most companies do not include a detailed review of VAT impact to the proposed future state. With (on average) worldwide VAT rates inching ever closer to 20%, the estimated value of converting to a global procurement model can be significantly im-pacted by triggering unrecoverable VAT costs to the US TopCo/parent entity.

Types of Procurement

For purposes of this article, there are two main types of procurement; direct procurement and indirect pro-curement. Direct procurement, which encompasses raw materials, component parts and other production related goods, has the greatest potential to impact op-erating margins. Changes in direct procurement costs have a direct impact to the per-piece cost (and there-fore any additional good produced will have the same increase in cost-of-goods-sold or “COGS). As an ex-ample, assume the total direct procurement value for a widget is $100. Assume that the raw material per-centage of that total cost is $50. Finally, assume the VAT rate is 20%. If the global procurement team does

Value Added Tax





not effectively ensure that the input VAT paid can be recovered, the COGS is increased by 10% (see calcu-lation below):

Total Direct Procurement Value = $100 Total Cost of Raw Materials = $50 VAT rate = 20%

($50*.20) + $100 = $110

As such, if the estimated cost benefit of the global pro-curement is less than 10%, the overall impact to the enterprise is an increase in procurement costs.

The second type of procurement is indirect. Indirect procurement includes maintenance, repair and oper-ating supplies. While the aggregate of indirect pro-curement may be material, these costs are effectively amortized over the related total additional volume of production. Assuming the following:

Repair Cost = $1,000 Additional units produced = 100,000 VAT rate = 20%

($1,000*.20) + 1,000/100,000 = .2%

As the two examples above indicate, unrecoverable VAT costs related to direct procurement items offer the greatest value potential.

Terms and Conditions

Terms and conditions (“Ts&Cs”) are generally the stan-dard contract language for all agreements made by the corporation or even standard language related to a particular type of purchase. For global procurement agreements, Ts&Cs should include:

Pricing (inclusive or exclusive of VAT)•Shipping terms (see Incoterms discussion •below)Title transfer provision (see discussion be-•low)Tax terms (both indirect and direct if there is •potential for withholding)

From a pricing perspective, it is very important that the parties to the agreement agree to whether or not VAT is included in the stated price (either as the total value of the agreement or as a per piece price). If

inclusive, any purchase order (“PO”) issued under the agreement would not account for additional monies to be paid for VAT. If exclusive, the PO should account for the expected VAT amount. This is one of the most common errors of centralized global procurement. If the invoice amount is greater than the PO due to a VAT charge, the company would most likely short-pay the VAT as the PO did not match the invoice amount.

As to tax terms, many companies have basic language to cover direct tax withholding but little in regards to indirect tax. Depending on the complexity of the com-pany’s procurement, indirect tax language guidance can be as little as a few paragraphs to several pag-es. Regardless of complexity, standard tax language should include guidance on how indirect taxes are de-fined, how indirect taxes are identified on the invoice and which party has the obligation to pay the indirect taxes.

Global Procurement Management

One of the consequences of moving to global pro-curement is that the other company functions, such as accounts payable (“AP”) and record retention, are impacted. Often both of these functions are housed in a shared service center (either in the US or overseas). If so, global procurement will trigger a requirement to review these processes.

For AP, one of the first questions will revolve around the timing of payment (not all VAT regimes define the taxable event as the supply of goods or services). Other issues to consider include:

Are invoices maintained as hardcopies, im-•aged copies or electronic invoicesWhat are the procedures to retrieve invoices•Are electronic invoices maintained on the •companies’ servers or by third partiesHow long are invoices kept•

If AP’s standard work mandates that invoices are ei-ther electronic or imaged copies, there are potential VAT compliance issues (certain jurisdictions require invoices be maintained in original form). If the compa-ny has taxable activities in a jurisdiction that requires original invoices, additional workflow processes must be inserted into AP’s standard work to maintain the original invoices.



Lastly, procurement may be partially or completely out-sourced to a third party provider. Functionally, the third party provider may act as a processor of invoices and submit to the client for payment, the direct payment agent (funded by the client) or some combination of the two. However, from a VAT perspective, the same issues are present as if the process was completed in house.

Sourcing

Strategic sourcing is the collaborative and structured process of analyzing a US multinational’s AP spend and then strategizing on how to buy goods and ser-vices effectively and efficiently from global suppliers with maximum cost benefit to the company. When sourcing goods, the procurement group needs to be mindful, among other things, of consolidation of sup-pliers (to achieve better price and purchase terms), the tax environment of the supplier and contract fulfillment process, in particular in which country title to the goods will transfer to the company, and how the goods and services will be utilized.

International Trade and Practice

As US multinationals enter into global procurement contracts, international trade law and practices will become part of the contract whether expressly written into the contract or can be inferred due to commercial usage.

Incoterms 2010

International Commerce Terms (“Incoterms”) are inter-nationally recognized standard trade terms that set out buyer and seller responsibilities. Incoterms are main-tained and developed by the International Chambers of Commerce (“ICC”). Each Incoterm establishes who is responsible for costs and risks such as transport costs, insurance, import VAT & customs duties payable, and who is responsible for customs clearance formalities in the country of import. Incoterms are accepted by gov-ernments, legal authorities and businesses worldwide for the interpretation of most commonly used terms in international trade, if the contract is silent on these matters. This reduces or removes uncertainties and often costly misunderstandings arising from different interpretation of such terms in different countries. In-coterms apply to both domestic and international sale and purchase contracts. Continued on page 15


ICC has updated the Incoterms to be used in international contracts and the new 2010 Incoterms effective January 1, 2011 are: INCOTERMS and Potential VAT Implications1

Abbreviation Term Potential VAT Implications

CIP Carriage and Insurance Paid To (... named place of destination)

The seller can sell goods VAT zero rated (either as an export or an intra-EU transaction, if both seller & buyer are in the EU) provided all condi-tions are met. Both the seller and the buyer can be the importer of record. However, if the seller imports the goods it must pay import VAT and customs duties (if applicable) in the country of import and then make a domestic sale and charge local VAT. Depending on local VAT registration requirements, seller may be required to register and charge VAT and also comply with the applicable VAT compliance obligations. In practice, the buyer in the country of import will often be the importer of record.

CPT Carriage Paid To (... named place of destination)

The seller can sell goods VAT zero rated (either as an export or an intra-EU transaction, if both seller & buyer are in the EU) provided all condi-tions are met. Both the seller and the buyer can be the importer of record. However, if the seller imports the goods it must pay import VAT and customs duties (if applicable) in the country of import and then make a domestic sale and charge local VAT. Depending on local VAT registration requirements, seller may be required to register and charge VAT and also comply with the applicable VAT compliance obligations. In practice, the buyer in the country of import will often be the importer of record.

DAP Delivered at Place (...named place of destination)

The seller can sell goods VAT zero rated (either as an export or an intra-community transaction, if both seller and buyer are in the EU) provided all conditions are met. The buyer will be the importer of record in the country of import.

DAT Delivered at Ter-minal (...named place of destination)

The seller can sell goods VAT zero rated (either as an export or an intra-community transaction, if both seller and buyer are in the EU) provided all conditions are met. The buyer will be the importer of record in the country of import.

DDP Delivered Duty Paid (... named place of destination)

The seller transfers own goods from the country of origin to the country of import. No local VAT is due in the country of origin provided all conditions are met (i.e. proof of export). In the country of import, the seller must pay VAT at import (or account for acquisition VAT if both country of dispatch and country of acquisition are in the EU). Subsequently, the seller makes a domestic sale in the country of import of the goods. Depending on local legislation, VAT must be charged on this sale. It is likely that the seller may be required to register for VAT and comply with corresponding VAT compliance obligations.

1 This is general VAT guidance for parties in global procurement contracts that identifies the party liable for import VAT and Customs Duties payments in the country of import. VAT advice should be obtained regarding the VAT implications of Incoterms to be adopted.



EXW Ex Works (...named place)

The seller should in practice charge VAT (if a VAT system exists in the seller’s country) on this sale. If certain conditions are met, the sale can be VAT zero-rated. However, the seller has the burden of proving that the goods are actually shipped abroad (which is difficult, since the seller delivers locally to the buyer in the supply chain). The buyer would be the importer of record in the country of import.

FCA Free Carrier (….named place)

The seller can zero-rate the sale provided it can prove that the goods ac-tually leave the country of origin (the seller cleared the goods for export). The buyer would be the importer of record in the country of import.

CFR Cost and Freight (...named port of destination)

The seller can zero-rate the sale (either as an export or an intra-EU trans-action, if both seller & buyer are in the EU) provided all conditions are met. Both the seller and the buyer can be the importer of record. Howev-er, if the seller imports the goods it must pay VAT at import and customs duties (if applicable) and the sale becomes a domestic sale in the country of import. Depending on local VAT registration requirements, seller may be required to register and charge VAT and also comply with the appli-cable VAT compliance obligations. In practice, the buyer in the country of import will often be the importer of record

CIF Cost, Insurance and Freight (... named port of destination)

The seller can zero-rate the sale (either as an export or an intra-EU transaction, if both seller & buyer are in the EU) provided all conditions are met. Both the seller and the customer can be the importer of record. However, if the seller imports the goods it must pay VAT at import and the sale becomes a domestic sale in the country of import. Depending on local VAT registration requirements, seller may be required to register and charge VAT and also comply with the applicable VAT compliance obligations. In practice, the buyer in the country of import will often be the importer of record.

FAS Free Alongside Ship (... named port of shipment)

The seller can zero-rate the sale provided that it can prove that the goods actually leave the country of origin (either as an export or an intra-community transaction, if both seller and buyer are in the EU). The buyer would be the importer of record in the country of import.

FOB Free On Board (... named port of shipment)

The seller can zero-rate the sale provided that it can prove that the goods actually leave the country of origin (either as an export or an intra-community transaction, if both seller and buyer are in the EU). The buyer would be the importer of record in the country of import.

Title Passage

Once it has been decided which party will be respon-sible for the insurance, carriage and payment of import VAT & customs duties, the next consideration in any global procurement contract is, when title passes to the company.

Title passage will also determine the place of supply of goods and services, which is the place the purchase is made and where VAT becomes payable by the compa-ny. There are different place of supply rules for goods and services:



Goods: The place of procurement of goods is where the goods are physically located when the supplier made the goods available to the buyer or where the buyer became entitled to dispose of the goods (this could be a legal or beneficial ownership). The place of supply of goods can become complex in multiple chain contracts involving different countries in the sup-ply chain.

Services: The place of procurement of services can be complicated. There are various rules that apply, de-pending on:

Whether the supplier has more than one busi-•ness location to fulfill its sale to the multina-tional;The type of services procured by the multina-•tional; andThe place where the multinational is estab-•lished or the place where the services will be utilized

Potential VAT Pitfalls to be Avoided in Global Procurement Contracts

Potential pitfalls to global procurement contract in-clude, but are not limited to, the following:

Review the parties to the contracts to ensure 1. that the buyer does not create any additional VAT registration obligation, permanent estab-lishment (or PE) and potential income tax filing obligations due to the sourcing of the goods and services and the subsequent distribution thereof.Review the Incoterms agreed to in the con-2. tract and the practical usage adopted therein; which often times is inconsistent with the gen-eral usage of Incoterms. With the growth of enterprise reporting platform 3. systems to streamline processes and create global oversight, management and control, good supplier data is necessary to ensure that the supplier master file has the correct data elements required to automate procure-to-pay processes and the corresponding VAT due on global contracts. With the advent of the centralization of pro-4. curement function, there is an increasing need to have a dynamic automated tax determina-tion tool to ensure that VAT is being calculated on transactions at the correct VAT rate, correct VAT amount at the correct time and posted into

the appropriate VAT general ledger account. Invoice is “king” and if the invoice is issued to 5. the incorrect legal entity, which is not regis-tered for VAT in the country where the goods or services are to be utilized, that entity may not be able to recover the VAT; consequently, the VAT becomes trapped and added to the cost of doing business.Another pitfall to avoid is disruption to the 6. buyer’s supply chain process due to unpaid VAT on a supplier invoice. This typically hap-pens, where due to incorrect invoice and VAT validation process, the buyer short-pays on a supplier invoice and no control point is put in place to catch such short payment on supplier AP invoice. Due to the structure of global procurement 7. contracts, US multinationals will enter into the contract for the procurement of services and will incur the cost and seek to “push down” the cost through an intercompany billing process-es. The pushed down cost could give rise to potential transfer pricing issues, and withhold-ing tax in the country of the recipient of the services which may not be factored into pay-ment to be made to the parent company. There could be potential VAT on locally sourced goods and services, which if not structured properly, could be pushed down and thereby trapped VAT.

Conclusion

As US multinational companies seek higher margins from limited-growth revenues, global procurement contracts are becoming very attractive. Global pro-curement contracts drive down per piece cost through volume purchasing and preferred provider relation-ships. US multinationals can also drive out costs from their current state procurement costs by creating syn-ergies in systems, process activities and eliminating redundant FTEs. However, without serious review of potential VAT impact, the expected savings from global procurement can be materially eroded and even elimi-nated.


The Utility Services Sales Tax Base in New JerseyAtlantic City Showboat, Inc. v. Dir., Div. of TaxationCass D. Vickers, CMI, Esq.IPT Deputy Executive Director and State Tax CounselAtlanta, GAPhone: 404.240.2300Email: [email protected]

T he deregulation of an industry invariably yields state and local tax issues, as this case concerning the generation, transmission and distribution of

electric power vividly illustrates. Atlantic City Showboat, Inc. v. Dir., Division of Taxation, 2012 WL 234426 (N.J. Tax), January 24, 2012. Prior to the enactment of the Electric Discount and Energy Competition Act (the Act), N.J.S.A. 48:3-49, et seq. by the New Jersey legislature on February 4, 1999, purchasers of electric power paid a franchise and gross receipts tax incorporated in a bundled charged for electric utility services. At that time, electricity was provided on a monopoly basis by companies operating in geographically-defined service territories; they controlled, and the tax base included, generation, transmission (through high-voltage power lines and other infrastructure) from generation plant to local distribution systems, and distribution (on low-voltage lines and other assets) to customers. As public utilities, the companies made substantial investments and incurred significant liabilities to assure customers adequate and reliable power supply.

Following deregulation in 1999, customers can purchase generation and transmission in the marketplace or from the local electric public utility distributing the same. The Act required the unbundling of charges to customers, specifying, at a minimum the charges for generation, transmission and distribution, and customer service (administrative) charges. The legislature authorized public power companies to assess on consumers a number of additional charges, including but not limited to: -market transition charges (to recover costs incurred in moving from the regulated monopoly to the competition-based system, including generation plant and other stranded costs and restructuring costs) -transition bond charges, and -societal benefits charges (costs associated

with statutorily-required programs such as low-income customer assistance, winter moratorium programs, utility practices related to bad debt customers, weatherization, nuclear plant decommissioning, etc.).

As part of the reform, the sales and use tax was expanded, first to include electricity in the definition of “tangible personal property,” and secondly, to add to the list of taxable services “utility services.” The term “utility services” is defined as “the transportation or transmission of natural gas or electricity by means of mains, wires, lines or pipes, to users or customers.” N.J.S.A. 54:32B-2(hh). Further, the pre-existing exemption from sales tax for “transportation of . . . property” was made inapplicable to “transportation of energy” [defined to include electricity]. N.J.S.A. 58-32B-8.11. Sales tax is required to be included in the rates charged for electric service, so that it does not appear as a separate line item on customer invoices.

The plaintiffs filed refund claims for sales tax paid on distribution charges and on certain other authorized charges. Their contention was that while generation and transmission is subject to sales tax, distribution is a service but does not fall within the definition of taxable “utility service” and that receipts for such service are not subject to sales tax. As to the other charges, they contended that they were not related to the provision of electricity, but represented a recovery of past investment costs related to electricity generation. Accordingly, they should not be treated as receipts from “utility services.” Note that the question goes to the reach of the sales tax, namely the question whether “utility service” includes charges for distribution and receipts from the other charges in question. Any legitimate issue over the reach of the statute should be resolved under the familiar principle of statutory construction that ambiguities in a taxing provision are to be construed in favor of the taxpayer and against the government.

The Tax Court here began its analysis with the statement that “the Director’s interpretation of tax statutes is entitled to a presumption of validity,” and reminding all that the court defer with “’great respect’ to the Director’s application of tax statutes.” It also cited authority for reading the sales and use tax statute broadly as creating “a presumption that transactions are taxable.” While it acknowledged that the tax reaches only “specifically enumerated services,” the court concluded that receipts from “distribution” fell within the plain meaning of the phrase “utility service.” In particular, the court held that distribution charges reflected the “transportation of electricity


Sales and Use Tax



(an item of tangible personal property) on local electric utility low-voltage lines and infrastructure. The court distinguished the regulatory use of the term “transmission” as excluding “distribution” and pointed out that the sales tax statute taxed both the transmission and “transportation” of electric power. It rejected the plaintiffs’ reading of the statute as limiting “transportation” to natural gas and restricting sales tax, where electricity is concerned, to “transmission.” The opinion found comfort in the legislature’s decision to carve out of the general sales tax exemption for “transportation of . . . property” the “transportation of energy,” expressly defined to include electricity.

The court declined the contention that regulatory statutes broadly defined “utility service,” carefully distinguishing “transmission” from “distribution,” and that had the legislature wished to subject “distribution” to sales tax, it would have followed the same approach. It found nothing indicating that the sales tax act incorporated the regulatory definitions, and cited a counter-indicative provision in Title 48, the regulatory statute, referring to “utility service as defined in [the sales tax statute].” Nor was the Tax Court persuaded that distribution was non-taxable on the basis that, as a contractual matter, title to the electricity passed to the customer at the point of delivery on the local electric utility system. In the court’s words, “regardless of where title passes, a distribution charge is an amount imposed in exchange for the service of transporting electricity to a user or customer and is subject to sales tax under N.J.S.A. 54-32B-2(hh).”

As for the taxability of the other charges, the court quoted the statute governing for most of the refund period: it defined a taxable “receipt,” in relevant part as “the amount of the sales price of any property and the charge for any service taxable under this act . . . but excluding the cost of transportation where such cost is separately stated . . . .” Where it read “transportation” as extending to “distribution” services, it addressed the market transition and other charges using a different tack. The opinion invoked examples from the regulations which effectively apply an associational or “in connection with” test—if receipts are realized in connection with (think, billed simultaneously) charges for a taxable service, they are part of the base to which sales tax applies.

Employing that approach, the Tax Court repudiated the taxpayers’ argument that, for example, charges for stranded costs allowed the recovery of investments and contractual costs associated with generation

and supply (under the prior regulatory regime) and had nothing to do with the distribution service found to be subject to tax. Confusingly, the opinion quoted the statutory provision making taxable “the charge for any service taxable under the Act,” but declared that “there is, however, no express provision in N.J.S.A. 54-32B(2)(d) that a charge for a service must be related to the provision of that service.” If the statute has a plain meaning, it would appear to be that the charges subject to tax are those imposed for the taxable service (distribution), and not associated or incidental charges billed to recover other costs not directly incurred in distributing electric power to customers. But the court insisted that all amounts paid are part of the tax base “whether the consideration can be traced to an element of the provision of the service or not.” It held that “plaintiffs paid market transition charges for the distribution of their electricity,” meaning only that such charges were on the same customer bill

as the charges for distribution sent out by the local public utility. Similarly, the court ruled that customer service charges for metering, billing, and other administrative activities were taxable because they were “associated with the delivery of electricity to consumers.”

That is a very aggressive reading of the statute that has clear and significant

implications in this and other contexts. It would sweep into the tax base all receipts derived in connection of the sale of a taxable service on the premise that all such receipts are being paid “for” the service that is subject to tax. Not only does that interpretation fly in the face of the principle that only specifically enumerated services are subject to tax, but it would produce improbable, if not anomalous results. If a tax code subjected to sales tax charges for the installation of software but excluded or exempted services rendered in designing custom software, a bill that included charges for both would be fully subject to tax under the court’s approach. The result would be palpably inconsistent with the legislative decision to restrict tax to installation services. Respectfully, the court’s interpretation abandons the part of the tax scheme limiting tax to specifically enumerated services, a constraint that is arguably based in state constitutional provisions requiring legislatures to be specific as to the objects of taxation. “Presuming” that charges are taxable merely because they have been “associated” with taxable services on an invoice goes too far. So does the deference-to-agency-of-expertise notion when it has the effect of relieving the legislature of the decision what receipts to tax and puts that law-making function in the hands of an executive agency whose mission, properly conceived, is the collection of taxes imposed by legislative specification.


CMiCorner

Any questions regarding the CMI Professional Designation can be addressed to Christina Webb, Manager of Education and Certification programs at [email protected] or Emily Archer, Certification Specialist at [email protected].

Don’t Lose Your Continuing Education Credit!

Remember, March 31, 2012 is the last day to submit any unreported CE credit earned during the 2011 Calendar year. In order to maintain

your CMI designation, continuing education (CE) credit must be submitted on a yearly basis. Board Policy states that all CE earned during a previous year must be submitted no later than 60 days following receipt of yearly status reports, which were emailed to all active CMIs in January. If you did not receive your CE report, please e-mail Emily Archer at [email protected].

Credits earned from other organizations must have the Application for Continuing Education Credit form attached with the required information and be submitted no later than March 31 of the year following the year that the credit was earned.

CMi CandidateConneCtion

Question of the Month:

What is the CMI Candidate Application Process?

Answer: 1. Submit Application2. Application is reviewed by IPT Staff & CMI

Committee3. Applicant notified of candidacy

Includes information on accessing study material online.

4. Applicant notified of eligibility Met requirements: eligible to sit at next exam. Lacking requirements: ineligible to sit without

further verification of requirements.5. Eligible candidates will receive an email 6 – 8

weeks prior to each exam with the exam details. Candidates are asked to respond to the email to indicate if they will sit at that particular exam.

6. Examinees are notified of the exam results in writing. You may request a review of your exam with

a committee member within 60 days of the exam.

New CMIs will receive a lapel pin and certificate via mail within 3 weeks of the exam.

Please note: *Applicants have six consecutive testing opportunities from the date of application (not eligibility) to meet the requirements in effect for certification. *Applicants must notify the IPT office in writing to update their application as requirements are met.Please review the CMI Income Tax Candidate Orientation Slideshow, CMI Property Tax Candidate Orientation Slideshow, or CMI Sales Tax Candidate Orientation Slideshow for a complete overview of the application process.More information on all of these announcements can be found on IPT’s website at www.ipt.org.





Income Tax Topics March 19-20, 2012

Apportionment “410” – An In-depth Analysis of Sales Factor Issues Involving the Sale of Tangible Personal PropertyApportionment “420” – An In-depth Analysis of Sales Factor Issues Involving the Sale of Services and IntangiblesApportionment “430” – An In-depth Analysis of Property and Payroll Factor Issues State of the States Address Apportionment “440” – An In-depth Analysis of Alternate Apportionment MethodsCurrent Update – Applications of Add- Back Statutes and De-ConformityUpdate on Economic Nexus – It’s the Next Best Thing to Being ThereSophisticated Audit and Appeals Strategies for Income Tax Cases (Business/Non-Business, Unitary/Non-Unitary, Transfer Pricing, etc.)Emerging Issues – Cases in the PipelineAccounting for State Income Taxes– Ask the ExpertsSurvivor Ethics – Who Will Get Voted Off the Swamp Island and Who Will Be Left to Fend off the Alligators?

ABA/IPT Advanced Tax SeminarsMarch 19 - 23, 2012 ~ The Ritz-Carlton ~ New Orleans, LA

Brochure Registration Hotel Reservation

Sales/Use Tax TopicsMarch 20-21, 2012

Survivor Ethics – Who Will Get Voted Off the Swamp Island and Who Will Be Left to Fend off the Alligators? Nexus Newsbreak: Current Legislative, Administrative and Judicial Developments and Trends Regarding Nexus and Reporting RequirementsWho Gets the Pot of Gold?: The Conundrum of Sourcing Transactions for Sales/Use Tax Purposes The Tax Tug of War: Tax Administration Issues Facing Taxpayers and Tax Administrators in Tough Economic TimesGumbo for Dinner? - A Mixture of Everyday Sales Tax Issues: Current Issues Related to Manufacturing Exemptions and Bad Debt Refunds and Credits Discussion of Current State and Local Tax IssuesBefore You Sign on the Dotted Line . . .: Best Practices for Drafting Transaction Documents from a Sales/Use Tax Perspective And the Hits Just Keep on Coming: The Annual National Multi-State Sales/Use Tax UpdateYou Asked for It Playing Well with Others: Exploring the Interplay between Sales/Use Taxes and Other TaxesCanadian VAT: 4-3 = 2 Finders Keepers?: Like it or Not, Unclaimed Property Issues are Here to StayLet’s Play Hide and Seek: Key Issues Regarding Privilege and Confidentiality in State Tax Disputes

Bringing together business tax professionals

Property Tax TopicsMarch 22-23, 2012

Effects of Regulations on Valuation Functional Obsolescence State Update Session I: New Jersey, New York, Ohio, and PennsylvaniaThe Use of Review Appraisals in Property Valuation Cases State Update Session II: California, Florida, Louisiana, and TexasArbitration/Mediation/ADR Use of Constitutional Provisions to Challenge Property Tax AssessmentsCapitalization Rates in an Uncertain MarketAttorney-Client Privilege, Work Product, and ConfidentialityEthics: Keeping Your Hands Clean in a Sometimes Messy World


2012 Intermediate Real Property Tax SchoolMarriott Kingsgate Conference Center University of Cincinnati, Cincinnati, Ohio

April 29 - May 4, 2012

Tools of the Profession

This is a comprehensive, five-day school for property tax professionals who have some experience in the real property area. The purpose of the program is to provide students with a fundamental and integrated knowledge of property tax principles, concepts and technical skills essential to the field. The course is designed to investigate in-depth the real property tax valuation process and related subjects. For a sample program agenda, visit IPT’s website.

Brochure Registration Hotel Reservation

P R O P E R T Y T A X C A L E N D A R

This information is provided by International Appraisal Company (IAC) and is provided for quick reference/reminder purposes only. IPT and IAC make no guarantee to completeness or accuracy and are not responsible for errors or omissions or for any results from the use of this information. We strongly suggest confirmation of all information with local taxing jurisdictions.

M a r c h 2 0 1 2Appeals Due Personal Property Filing Dates: Assessment Dates:

AK* HI* KS* MI* SC* SD* VA*AZ* 60 days after noticeCT* 3/20 or 2/20DE 3/15NH 3/1NM 3/31 or 30 days after noticeVA ArlingtonNY 3/1 - Nassau County 3rd Tuesday - Rochester 3/15 - AuburnOH** 3/31PA** 3/31 Allegheny CountySD Thursday preceding the third Monday

GA* MA MO OR TN VA* WI WY . . . . .3/1

ID KS OK . . . . . . . . . . . . . . . . . . . . . . . . . . .3/15

IN 3/1

*Dates vary, Check Jurisdiction **Date falls on weekend, should be next business day, Check Jurisdiction .


Please visit the Career Opportunities page on the IPT web-site for complete position descriptions and requirements.

Ca r ee r sPositions Available:

Senior Tax Analyst (Fort Worth, Texas) – Textron. Apply at https://careers.textron.com/psc/hr91prd/EMPLOYEE/HRMS/c/HRS_HRAM.HRS_CE.GBL?Page=HRS_CE_JOB_DTL&Action=A&JobOpeningId=116359&SiteId=1&PostingSeq=1. Date Posted: 1/26/2012 (IPT805)

Analyst/Compliance Coordinator, Sales & Use Tax (Fort Worth, Texas) – Textron. Apply at https://careers.textron.com/psc/hr91prd/EMPLOYEE/HRMS/c/HRS_HRAM.HRS_CE.GBL?Page=HRS_CE_JOB_DTL&Action=A&JobOpeningId=114884&SiteId=1&PostingSeq=1. Date Posted: 1/26/2012 (IPT804)

Sales & Use Tax Associate (Fort Worth, Texas) – Textron. Apply at https://careers.textron.com/psc/hr91prd/EMPLOYEE/HRMS/c/HRS_HRAM.HRS_CE.GBL?Page=HRS_CE_JOB_DTL&Action=A&JobOpeningId=116361&SiteId=1&PostingSeq=1. Date Posted: 1/26/2012 (IPT803)

Senior Sales Tax Audit (Lake County, Illinois) – Send resume to [email protected]. Date Posted: 1/26/2012 (IPT802)

Senior Tax Accountant – Indirect Taxes (Franklin, Tennessee) – Parallon Business Solutions (subsidiary of HCA, Inc. (Hospital Corporation of America). Apply at http://hcahealthcare.com/ Job Number: 10201-5869. Date Posted: 1/24/2012 (IPT801)

Manager, Indirect Taxes - Indirect Taxes (Franklin, Tennessee) – Parallon Business Solutions (subsidiary of HCA, Inc. (Hospital Corporation of America). Apply at http://hcahealthcare.com/ Job Number: 10201-5870. Date Posted: 1/24/2012 (IPT800)

Tax Analyst (Fort Worth, Texas) – Lhoist North America. To apply, please visit our website at www.lhoist.us and go to the JOBS tab. Date Posted: 1/19/2012 (IPT799)

Senior Property Tax Manager (Atlanta, Georgia) – Submit resume to the following Email [email protected]. Date Posted: 1/18/2012 (IPT798)

Senior Income Tax Analyst (Duluth, Georgia) – THE QUIKRETE® COMPANIES. Interested candidates should send their resume and salary requirements to [email protected] to be considered for this position. Date Posted: 1/17/2012 (IPT797)

Property Tax Consultant (Wheaton, Illinois) – Barron Corporate Tax Solutions. Please forward resume with salary requirements to: [email protected]. Date Posted: 1/10/2012 (IPT796)

Sr. Analyst, Property Tax Valuation & Analysis (Orlando, Florida) – Wyndham Vacation Ownership. Send resume to [email protected]. Date Posted: 1/10/2012 (IPT132)

Senior Property Tax Manager (Indianapolis, Indiana) – Simon Property Group Inc. To apply, please submit resumes to the following: Email – [email protected]; Fax – 317-263-2318; Mail – Simon Property Group - Attn: Human Resources - 225 W. Washington Street - Indianapolis, IN 46204. Date Posted: 1/5/2012 (IPT131)

Property Tax Consultants – Send resume to [email protected] or call 360-687-1602. Date Posted: 1/4/2012 (IPT130)

To submit a position announcement, email Toby Miller at [email protected]. Include the job title, city/state, and the Tax Specialty, i.e. Property/Sales/Income.










Sales Tax School I: Introduction to Sales & Use Taxes Georgia Tech Hotel & Conference Center Atlanta, Georgia February 26 - March 2, 2012

ABA/IPT Income Tax Seminar The Ritz-Carlton New Orleans, Louisiana March 19 - 20, 2012

ABA/IPT Sales Tax Seminar The Ritz-Carlton New Orleans, Louisiana March 20 - 21, 2012

ABA/IPT Property Tax Seminar The Ritz-Carlton New Orleans, Louisiana March 22 - 23, 2012

Sales Tax School II: Theory & Practice for the Experienced Sales & Use Tax Professional Marriott Kingsgate Conference Center University of Cincinnati, Cincinnati, Ohio April 22 - 27, 2012

Intermediate Real Property Tax School Marriott Kingsgate Conference Center University of Cincinnati, Cincinnati, Ohio April 29 - May 4, 2012

Basic State Income Tax School Georgia Tech Hotel & Conference Center Atlanta, Georgia June 4 - 8, 2012

Advanced State Income Tax School Georgia Tech Hotel & Conference Center Atlanta, Georgia June 4 - 8, 2012

CMI - Income Tax Exams Renaissance Esmeralda Resort Indian Wells, California June 22 - 23, 2012

CMI - Sales Tax Exams Renaissance Esmeralda Resort Indian Wells, California June 22 - 23, 2012

CMI - Property Tax Exams Renaissance Esmeralda Resort Indian Wells, California June 23, 2012

36th Annual Conference Renaissance Esmeralda Resort Indian Wells, California June 24 - 27, 2012

Ohio One-Day Tax Seminar Renaissance Columbus Downtown Hotel Columbus, Ohio July 20, 2012

Property Tax School Georgia Tech Hotel & Conference Center Atlanta, Georgia August 12 - 16, 2012

CMI - Sales Tax Exams Hyatt Regency Minneapolis Minneapolis, Minnesota September 28 - 29, 2012

Sales Tax Symposium Hyatt Regency Minneapolis Minneapolis, Minnesota September 30 - October 3, 2012

Value Added Tax Symposium Hyatt Regency Minneapolis Minneapolis, Minnesota October 3 - 5, 2012

Intermediate Personal Property Tax School Georgia Tech Hotel & Conference Center Atlanta, Georgia October 14 - 19, 2012

Texas Taxpayers and Research Association (TTARA) Hyatt Regency Austin Austin, Texas October 15 - 16, 2012

Credits and Incentives Symposium Buena Vista Palace Hotel Lake Buena Vista, Florida October 21 - 24, 2012

CMI - Income Tax Exams Key Bridge Marriott Arlington, Virginia November 2 - 3, 2012

Income Tax Symposium Key Bridge Marriott Arlington, Virginia November 4 - 7, 2012

Advanced Sales & Use Tax Academy Key Bridge Marriott Arlington, Virginia November 4 - 7, 2012

CMI - Property Tax Exams Tampa Marriott Waterside Hotel & Marina Tampa, Florida November 10, 2012

Property Tax Symposium Tampa Marriott Waterside Hotel & Marina Tampa, Florida November 11 - 14, 2012

Please check IPT’s online Calendar of Events for additional programs that may be added.

I P T 2 0 1 2 CALENDAR OF EVENTS