Initially enacted as a temporary measure, Congress made ITFA permanent in 2016 to reflect the enduring federal commitment to preserve a tax-neutral digital infrastructure and protect an evolving digital economy. Indeed, today’s “internet access” is no longer defined by static homepages and email alone, but by cloud computing, digital advertising ecosystems, streaming platforms, and bundled online services. As states seek new revenue sources, they are increasingly reinterpreting – and at times, ignoring – ITFA’s protections to capture taxes on these modern digital offerings.
In this installment of “A Pinch of SALT,” published by Tax Notes State, Eversheds Sutherland attorneys Charlie Kearns, Maria Todorova and Olivia Dibb analyze the evolving legal landscape of ITFA, including how states are testing federal protections in pursuit of digital revenue and how courts are responding to the challenges of a rapidly transforming digital economy.
Read the full article here.