KPMG reports: Oregon (motor vehicle use tax); Pennsylvania (corporate economic nexus)

KPMG reports: Oregon, Pennsylvania

KPMG’s This Week in State Tax—produced weekly by KPMG’s State and Local Tax practice—focuses on recent state and local tax developments.

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  • Oregon: The state’s tax court held that the motor vehicle use tax applied to purchases of vehicles by a rental car company. While Oregon does not impose a traditional sales and use tax, the motor vehicle use tax is imposed on the use in Oregon of motor vehicles purchased at retail. The taxpayer (a rental car company) claimed that its purchases of cars for use in Oregon were not purchases at retail and therefore that it did not owe motor vehicle use tax. The tax court disagreed, holding that the legislative intent of the phrase “vehicles purchased at retail” meant vehicles purchased by a purchaser other than for resale. In this instance, the taxpayer’s purchases were not for resale—the taxpayer purchased the vehicles to rent to customers. Read a September 2020 report

  • Pennsylvania: The Department of Revenue updated guidance (Corporation Tax Bulletin 2019-04) that adopted an economic nexus standard for corporate net income tax purposes. As revised, the bulletin adds interest and other intangible receipts to the list of types of receipts that count towards the $500,000 economic nexus threshold. The revised bulletin also addresses the application of the economic nexus standard to corporate partners. Read a September 2020 report

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