State Tax Headlines

1789

Georgia ~ Sales and Use Tax: Tax on Vehicles Repealed, Click-Through Nexus and Incentive Provisions Enacted, Tax Holidays Re-Enacted

Georgia Gov. Nathan Deal has signed legislation containing sales and use tax provisions related to the taxation of motor vehicles, nexus, incentives, and tax holidays. Developing details of the bill pertaining to sales and use tax were previously reported. (TAXDAY, 2012/03/22, S.6; TAXDAY, 2012/03/26, S.10)

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Washington ~ Multiple Taxes: Bill to Limit Financial Institution Mortgage Interest Deduction, Extend Food and Data Center Exemptions Passes Legislature

A bill passed by the Washington Legislature would limit the financial institution business and occupation (B&O) tax deduction for mortgage interest to community banks. Specifically, the bill provides that a financial business located in more than 10 states may not deduct amounts received as interest on loans secured by first mortgages or trust deeds on nontransient residential properties.

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Nebraska ~ Sales and Use Tax: Legislature Overrides Veto of Local Rate Increase

The Nebraska Legislature has overridden Gov. Dave Heineman’s veto to authorize an incorporated municipality to impose a local option sales tax at a rate of 1.75% or 2.0%. Previously, the local rate was capped at 1.5%. The proposal must be approved by at least 70% of the municipality’s governing body before it is submitted to voters at a primary or general election. Any tax increase beyond 1.5% will terminate after 10 years or upon the payment of any bonds and any refunding bonds, whichever occurs later.

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Kentucky ~ Sales and Use Tax: Disaster Relief Tax Refund Enacted

Kentucky Gov. Steve Beshear has signed legislation that provides legal owners of buildings damaged or destroyed by recent inclement weather in designated counties a refund of sales and use tax paid on purchases of building materials used to repair or replace these buildings. The legislation pertains to storms that occurred in Kentucky from February 29, 2012, through March 3, 2012, and only to buildings damaged or destroyed in counties declared federal disaster areas due to the storms. For a current list of these qualifying counties, see the Kentucky Department of Revenue’s website at http://revenue.ky.gov/taxrelief.htm. In this context, “building materials” means tangible personal property that becomes a permanent part of a building.

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North Dakota ~ Property Tax: Special Assessment Was Not Arbitrary, Capricious, or Unreasonable

A local North Dakota improvement district’s special assessment that was imposed upon a taxpayer’s property was not proven to be arbitrary, capricious, or unreasonable and was therefore upheld on appeal. The special assessment used to pay for the various physical improvements, and the related, properly included, engineer fees, attorney fees, and interest expenses, was duly authorized, and all of the statutory notice and review requirements were followed.

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Wyoming ~ Property, Severance Taxes: Mining Agreement Required Taxpayers to Pay Taxes on Royalties

Taxpayers that entered into a mining lease that granted a mining company the right to conduct mining operations on the taxpayers’ two separate parcels of property were obligated to pay Wyoming ad valorem property taxes and severance taxes related to the mineral production because the plain language of the mining lease reflected the parties’ intent that the taxpayers pay their share of the taxes on both parcels of property. Throughout the term of the mining lease, the mining company made royalty payments to the taxpayers, but withheld amounts asserted by the mining company to reflect the taxpayers’ share of ad valorem and severance taxes.

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