Thomson Reuters Reports 2012 Quirky Tax Laws

Mon Jan 28, 2013 9:30am EST

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Strange Laws Underscore Need for Technology and Expertise to Manage Complex Indirect Tax Process 

New York, January 28, 2013 -The Tax & Accounting business of Thomson Reuters today revealed a
sampling of 2012 quirky indirect tax changes, emphasizing the importance of corporate tax
technology and expertise to help navigate the dynamic indirect tax and VAT landscape. 

"While some of the changes may seem odd and unnecessary, they highlight how challenging it is for
corporations to stay on top of the sea of changing indirect and value-added tax laws," said Carla
Yrjanson, vice president of Tax Research and Content for Thomson Reuters." 

Thomson Reuters provides a trusted indirect tax software platform used by leading global
companies.  Companies that have deployed indirect tax solutions from Thomson Reuters benefit from
a proven technology infused with critical, timely tax content, which enables them to seamlessly
comply with tax changes immediately.

A few of the 2012 "quirky" sales and use tax highlights include: 

*In Illinois, fans of Whoppers malted milk balls are in luck.  The Illinois candy tax applies to
all candies, unless they contain flour, like Whoppers (IL FY 2010-01 July 2009; Illinois DOR
Informational Bulletin). 
*While food and food products are typically tax exempt, New York has deemed vegan edible gummy
drinking glasses taxable.   Under the current ruling, the glasses were deemed a confection and
therefore taxable under current sales and use tax law (Advisory Opinion issued October 24, 2012).
*Boat enthusiasts are rejoicing in Maine as a result of the new tax exemption for parts and
supplies such as sails, rope, rigging and masts used for operating, repairing and maintaining
windjammers used to ferry people and cargo as a business activity (36 MRSA § 2020 signed into law
July 6, 2011, effective October 1, 2012).
*Wine lovers in Maryland are now subject to double taxation should they wish to bring their own
bottle of wine to their favorite restaurant.  Under the new ruling, residents are taxed for having
someone open the bottle for them (MD SB 755/HB 228; Maryland Tax Bulletin 12-1 signed into law
April 10, 2012, effective July 1, 2012).
*Retiring just got sweeter for residents of Sitka, Alaska, who are now exempt from sales tax for
the purchase of goods, services and rentals after reaching the ripe age of 65 (effective October
1, 2012). 
*In Connecticut, not all diapers are created equal.  Adult diapers are tax exempt, but children's
diapers are taxed. 
* Alabama, playing
card decks that contain less than 54 cards are charged an additional $0.10 excise tax.  To ensure
compliance, each taxable deck must have "revenue stamps" affixed to the individual package. The
stamps must be affixed in such a manner that their removal will require continued application of
water or steam.  All taxable playing cards found in the possession of any person, firm,
corporation, club or association without having stamps affixed in this manner are subject to
confiscation (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §573; Acts 1951, No. 978, p. 1653; ). 

* last one is
not really an odd tax law, but rather a twist on a "normal" tax law turned strange by a business
owner. A theater owner in Spain came up with a unique solution to falling ticket sales after the
VAT on admissions to theaters was raised to 21 percent this summer:  carrots. Since vegetables are
subject to a reduced rate (currently 4 percent), the theater has transformed itself into a produce
stand of sorts. Now when customers opt to buy their carrots from the theater for a mere $16, they
are treated to a free theatrical performance (see: ). 

For more information on ONESOURCE Indirect Tax, visit: . 


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 Aimee Quemuel                     

Aimee Quemuel


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