[Discuss] Mass Tax on Software Services

[Joseph Guarino]

Hello Will/Tom/Everyone,

Wow!  I really can't believe that MA state government passed such an
poorly-conceived, overly broad, anti-growth tax.  Does anyone else feel
blindsided or like this was slipped under the radar?  Isn't it
interesting that there was almost NO coverage of this in the media and
they hid it in the depths of this "transportation" bill. 

What were they thinking?  As a political independent I'm not opposed to
taxation but I am opposed to them being unfairly levied against
industries we should be trying to encourage to stay in the state.
Especially so when it will have deeper economic impacts that these
politicians seem to not consider.   

Noting that we already have higher unemployment than we official tally
(real unemployment is double digit) why create a new tax that
discourages business from existing in Taxachusetts.  It should be clear
to local and state politicians that we are not a competitive state when
we place in the 25th in the nation vs. other states for business
attractiveness.  Do we want to attract new firms and foster startups?  
Do we want job growth?  

Additionally, this bill (like most legislation)  is WAY to broad and its
application is completely unclear.   We seem also to have like 2 minutes
to understand (it is hardly clear!) and comply with it.  WTH?!?   It
basically means most if not ALL of IT service would be taxed.  I'm
assuming that even means open source.  Seems like our politicians again
don't have basic tech or economic literacy.    

We can rest assure that this will:

Encourage firms to leave the state
Discourage growth of a key growth industries (IT/Cloud)
Dampen job growth
Make the state less competitive

It is important to note that only 3 other states have such ill conceived
taxes. 

What do you all think?

What should we do as a community?


Thanks and have a great week,

> Message: 2
> Date: Tue, 30 Jul 2013 01:44:03 -0400
> From: Tom Metro <tmetro+blu at gmail.com>
> To: L-blu <discuss at blu.org>
> Subject: Re: [Discuss] Mass Tax on Software Services
> Message-ID: <51F752A3.1030804 at gmail.com>
> Content-Type: text/plain; charset=ISO-8859-1
> 
> Will Rico wrote:
> > Anyone have thoughts to share on the new Massachusetts tax on software
> > services for "prewritten" software consulting or what it covers?
> > 
> > http://blog.codingoutloud.com/2013/07/28/open-letter-on-new-massachusetts-tax-on-software-services/
> 
> Good write-up. (The Slashdot discussion doesn't really add anything useful.)
> 
> The author initially paints the picture that this was a total surprise,
> but near the end lets on that he had heard earlier that the legislature
> was considering new taxes on software services, just that the scope was
> different. Another consultant in the BLU community, Joseph Guarino, has
> blogged/tweeted about this months ago when the earlier discussions were
> happening.
> 
> The law change, as currently presented, does seem to be quite vague, and
> raises numerous questions as to what is covered. Does any software using
> "prewritten" components qualify for this tax? How are subcontractors
> handled?
> 
> Until the scope of the change is understood, it's hard to argue the merits.
> 
> The other ridiculous bit is that they've scheduled to make the change
> effective 6 days after it was published. Normally you'd see 6 or 12
> months of advanced notice, so lawyers, accountants, and billing software
> can all be brought up to speed. The vagueness of the law only compounds
> this.
> 
> It gives the impression that maybe they aren't really serious abut
> collecting this tax any time soon. Just hoping for some voluntary
> participation in the remainder of 2013. (But that's obviously a high
> risk way to interpret it.)
> 
> I sent an email to my state rep seeking clarification. I encourage
> others who think they may be impacted by this to do likewise.
> 
>  -Tom
> 
> -- 
> Tom Metro
> Venture Logic, Newton, MA, USA
> "Enterprise solutions through open source."
> Professional Profile: http://tmetro.venturelogic.com/

Joseph Guarino
A+,CISSP,LPIC,MCSE2000-03,PMP,Healthcare IT+
Toastmasters ACS/CL
Evolutionary IT - Best Practice IT(tm)
Website: www.evolutionaryit.com
Blog: www.evolutionaryit.com/blog
Social Networks: network.evolutionaryit.com
888.404.5074 (Office)
617.953.9514 (Mobile)