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Sales Tax Update - June 2025

6/2/2025

Maryland Imposes New 3% Sales Tax on List of Software, IT and Data Services

On May 20, 2025 Governor Moore signed House Bill 352, enacting a 3% tax on a long list of software, data and IT services.  Recall that in 2021, Maryland expanded its sales tax to include digital products, which its defined broadly to include computer software regardless of method of delivery and certain business to business services. Excluded from taxable software requires configuration (i.e., does not operate immediately “out of the box”) and customized software.  In July 2022, Maryland effected additional sales tax legislation to exclude ...

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data processing

Sales Tax Update - April 2025

by Michael T. Dillon, Esq., Dillon Tax Consulting LLC
4/26/2025

Texas Comptroller Adopts Changes to Data Processing Services

Effective April 2, 2025, the Texas Comptroller effected changes to Texas Administrative Code Rule 3.330, addressing the definition and sales tax treatment of data processing services, most specifically (1) refining what constitutes and does not constitute data processing services, and (2) adopting an exclusion for data ...

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Texas Court says the “Essence of Transaction” involving a Provider’s technology platform is not “Data Processing”

Dillon Tax Consulting
5/10/2016

In a decision involving the true object, or “essence of the transaction” test, the Texas court of appeals upheld the trial court’s decision in favor of the taxpayer refund claim for sales tax assessed on the provision of bill pay services. In Hegar v. CheckFree Services Corporation, NO. 14-15-00027-CV (Tex. Ct. App., April 19 ...

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