KPMG reports - California (sales tax refunds); Indiana (advisory letters); Nebraska (manufacturing exemption); New Jersey (apportionment) 

May 12:  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 and features a series of short podcasts presented by KPMG tax professionals. Text of the podcasts is also available.

This week’s edition includes the following topics (listen to the podcasts; to read text, click on the links below).

  • California - The Supreme Court of California held that the state’s consumer protection law could not be used by individual plaintiffs to obtain sale tax refunds and damages from a retailer for sales taxes erroneously collected on “to go” hot coffee.

  • Indiana - A taxpayer could not rely on advice provided by the Department of Revenue in two anonymous advisory letters issued to the taxpayer, concerning the sourcing of its sales income to Indiana, because the taxpayer had not disclosed its identity to the Department prior to seeking and receiving the advisory letters.

  • Nebraska - A Nebraska district court held that a taxpayer (a farmer-owned cooperative) qualified for a sales and use tax exemption on purchases of machinery and equipment used to process and manufacture seed and animal feed. The court concluded that the taxpayer qualified for the exemption because it was clearly engaged in the business of manufacturing, despite not meeting the “primarily engaged” test.

  • New Jersey - The New Jersey Tax Court determined that a taxpayer’s gain on the sale of business segments was apportionable operational income subject to New Jersey corporate business tax, and that the taxpayer did not qualify for the liquidation exception.

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