The Indiana Department of Revenue ruled that a taxpayer's purchase of cloud computing software was taxable.
A company purchased access to prewritten accounting and point of sale software systems. The software was on servers located outside Indiana. The users were in Indiana and accessed the software online.
Charges for access to prewritten computer software are taxable as sales of software. This is because the customer gets to use, control, or direct the use of the software. The Department ruled that the company's use of computer software in Indiana made the sale taxable. It did not matter that the software was on servers outside the state.