ITAA backs business tax bill

The Information Technology Association of America is backing proposed legislation that would prevent states from imposing business activity taxes on companies that do not have a physical presence in the jurisdiction.

The House is considering the Business Activity Tax Simplification Act and is expected to vote on the measure later today.

“Clarification of the business activity tax nexus standard is particularly critical to [IT] companies, many of whom provide products and services remotely and as such, are often nonresident businesses,” ITAA President Robert Laurence said in a statement.

Many ITAA members have been unfairly burdened with business activity taxes in jurisdictions where they have no property or employees, he said. The bill would exclude such transaction taxes, including sales taxes, and would make it clear that states may not levy business activity taxes on companies that do not have a physical presence in the taxing jurisdiction.

Laurence said ITAA believes the tax simplification bill will assure fairness, minimize litigation and promote a level playing field for all taxpayers. He urged lawmakers to pass the legislation.