KPMG reports: Louisiana, Tennessee, Washington State

KPMG reports: Louisiana, Tennessee, Washington State

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.

  • Louisiana: A one-time state sales tax holiday is intended provide relief for the first $2,500 of any consumer purchases made on November 20 and 21, 2020. Read a November 2020 report

  • Tennessee: The Department of Revenue concluded that a foreign corporation with no effectively connected income was not subject to Tennessee’s franchise tax. Under Tennessee law, a taxpayer that has no income effectively connected with a United States trade or business” is considered not to have “substantial nexus” with Tennessee. The Department found that although the taxpayer was doing business in Tennessee, it lacked substantial nexus and that the taxpayer was not exercising its corporate franchise because that term was intended to capture only Tennessee-chartered and Tennessee organized business entities. Read a November 2020 report

  • Washington State: A tax revenue officer concluded that a taxpayer making sales through a facilitator had Washington business and occupation (B&O) tax nexus because it had inventory in the state. The taxpayer used the marketplace facilitator’s inventory management system that commingled inventory items between sellers making sales of the same items across the facilitator’s warehouses. The taxpayer argued that because it did not ship the goods into Washington and the facilitator had complete control over the goods, it had no inventory in Washington and did not have nexus. The tax revenue officer rejected this argument, noting that the taxpayer had agreed to the inventory management program and was provided information regarding the location of its inventory. Read a November 2020 report

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