Waypoints: Ideas and Insights to Navigate Enterprise Complexity

Updated March 12, 2020:

Senate Bill 2563 has been amended and passed by the Senate. It will now make its way through the House. The amended bill increases the minimum amount of incentives in order to qualify as a certified applicant from $1 million  to $5 million. This should significantly decrease the base of affected businesses.

Some of the reporting requirements for certified applicants were also removed, however, the requirements relating to information on a company’s supply chain and its Mississippi vendors remain. The amended bill also eliminates the requirement that the University Research Center (“URC”) performs an economic impact study for each incentive. Instead, the bill now only requires that the Mississippi Development Authority (“MDA”) shares its report with the URC and, upon request, with the Governor, Speaker of the House and President of the Senate.

On June 21, 2018, the Supreme Court of the United States (SCOTUS) issued a landmark ruling in South Dakota v. Wayfair. The case involved whether or not it was constitutional for a state to require an online retailer to collect sales tax on internet sales when there was no physical presence. The Wayfair decision overturned previous rulings by SCOTUS in National Bellas Hess v. Department of Revenue of Illinois (1967) and Quill Corp v. North Dakota (1992), where it was determined that a company must have a physical presence in a state in order for that state to lawfully require the collection and payment of sales tax.

On December 22, 2017, President Trump signed sweeping tax reforms into law. As a result of the new and modified federal provisions, state conformity has become a popular topic of conversation among tax practitioners. Many states will have to make difficult decisions, and several have already started the process.