Pennsylvania reverses its sales and use tax position on cloud computing and multiple points of use exemptions for software purchases


The Pennsylvania Department of Revenue (Department) has changed its position on the sales and use taxation of cloud computing transactions. Previously, the Department's position had been that remotely accessed software was only taxable if the servers hosting the software were in Pennsylvania. However, in its May 31, 2012 Letter Ruling No. SUT-12-001, the Department clearly states that sales or use tax is due if the end user is located in Pennsylvania regardless of the location of the seller or server. In addition to this change, the Department's ruling allows for the use of a multiple points of use exemption for software purchases.

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