Salt Report 3633 – The New York Department of Taxation and Finance released TSB-A-15(2) S on April 14, 2015. The TSB concluded that the petitioners cloud computing product was not subject to sales and use tax. Specifically, the DOT stated.
“Because providing a customer with computing power is not one of the services made taxable by the Tax Law, Petitioner need not collect sales tax on its sales of its Cloud Computing product as described herein. See Tax Law Section 1105”.
If all the facts line up a company’s cloud product may not be a taxable sale of prewritten software but it may meet the test to be defined as a non-taxable sale of “computing power.”