Massachusetts Repeals Tax on Computer and Software Services

Oct 2nd, 2013

Massachusetts' Governor Deval Patrick has recently signed legislation repealing the state's sales tax on computer and software services. The tax, which went into effect in July 2013, has been repealed with a retroactive repeal date effective July 31, 2013.

Taxpayers who remitted tax on the following services may submit an application for abatement by December 31, 2013: computer system design services, data access, data processing or information management services, and the modification, integration, enhancement, installation or configuration of standardized software. If a retailer is granted abatement, i.e. a reduction of the amount of tax assessed on their sales, the retailer must make reasonable efforts to refund the abated amounts to the original customers who paid the tax.

https://malegislature.gov/Bills/188/House/H3662

Update: The Massachusetts Department of Revenue has issued a technical information release for vendors seeking abatement for tax collected on these services. The release sets out the steps vendors should take by December 31, 2013 to file an abatement application with the state.

http://www.mass.gov/dor/businesses/help-and-resources/legal-library/tirs/tirs-by-years/2013-releases/tir-13-17.html