Computer services becoming a favorite tax target

Some states are looking at the information services industry as a possible new source of tax revenue. Most states already collect taxes on packaged software through state sales taxes. The Massachusetts legislature is debating whether or not to tax software development and computer maintenance and repair. Data processing groups, such as ADAPSO, are lobbying hard against the tax. An Alabama state court lifted the taxes on all computer-related services, but the state of Washington imposed a tax on most software and data processing services. The line between packaged and custom-designed software is blurring as states look for more sources of income.
Computer services becoming a favorite tax target NEW YORK--Cash-strapped state governments are increasingly looking to the booming information services industry as a new source of tax revenue to help fill [...]