Governor says exempting software as a service from sales tax will ‘make a big difference’ to Indiana.
3-8-2018
Tony Cook
Indianapolis Star
Technology companies that sell software as a service will no longer be required to collect sales taxes under a bill lawmakers sent Tuesday to Gov. Eric Holcomb.
Senate Bill 257 exempts remotely accessed, electronically delivered, pre-written computer software — also known as software as a service, or SaaS — from Indiana’s 7 percent sales tax.
Holcomb, who made the tax exemption part of his legislative agenda, said the measure will make Indiana one of only four states to exempt software as a service in state statute.
“This bill will help make Indiana a leader in supporting the tech community by exempting all software as a service from Indiana’s sales tax,” he said in a statement. “It’s a simple move that will make a big difference, and I look forward to signing this legislation.”
The exemption, which was a top priority for the Indiana Chamber of Commerce, is estimated to cost the state $5.7 million to $13.4 million in tax revenue during the 2019 fiscal year. Attracting technology companies has been a key goal for Holcomb, who joined executives from India-based information technology company Infosys to open its first North American hub in One America Tower on Tuesday.
Indianapolis is also the second-largest hub for cloud computing giant Salesforce, which last year opened a 250,000square-foot space in the city’s largest skyscraper, newly renamed Salesforce Tower, Holcomb and city leaders are also hoping to land online retailer Amazon’s second North American headquarters. The company has named Indianapolis one of 20 finalists for what is expected to be a $5 billion campus that will employ 50,000 workers with average salaries of more than $100,000 a year.
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