A troubling New Jersey financial transaction tax proposal, which appeared to be gaining popularity over the past few months, has reportedly been left out of the 2021 budget deal that Governor Phil Murphy recently struck with legislative leaders. The decision to drop the transaction tax from the deal came days after the Wall Street Journal reported that prominent stock exchanges with data centres in New Jersey were prepared to exit the state if the tax plan was adopted.
A concerning bill is pending in the California Senate which would require the California state controller's office to make taxpayer information publicly available. The bill would require that the controller post on its website a list of all taxpayers subject to the California corporation tax with gross receipts of $5 billion or more and information about each taxpayer, including tax liability and the amount of tax credits claimed in the previous calendar year.
The New Mexico Administrative Hearings Office recently issued an opinion that addressed the following questions: under what circumstances can a state constitutionally impose tax on a domestic company's income from foreign subsidiaries, including Subpart F income; and when is factor representation required? Since many state income taxes are based on federal taxable income, inclusion of these new categories of income at the federal level could potentially result in their inclusion at the state level.
The Oregon Supreme Court has rejected a business taxpayer's constitutional challenges to a 1993 Oregon statute that eliminated the right to utilise a three-factor apportionment formula in calculating Oregon income tax. The Oregon Supreme Court joined courts in Texas, Minnesota, California and Michigan in rejecting taxpayer arguments that states which have enacted Article IV of the Multi-state Tax Compact have entered into a binding contractual obligation which may not be overridden.