NY State Taxation Department Aims to Collect Sales Tax on Distance Education Courses
Posted on March 16, 2009 by Jennifer Brady
This guest post comes to us from a colleague Pamela Monaco, Director, University Without Walls at University of Massachusetts Amherst.
We all know times are tough, and any time you pick up a newspaper or listen to a news program, you hear reminders of how the individual and the states’ budget are impacted by our current financial crisis. Perhaps these desperate times are prompting some to desperate measures. See what you think of a proposal brought to our attention by Jack Stripling at Inside Higher Ed:
In a move that could prove a harbinger of things to come, a New York agency now contends that a distance education course is subject to state sales tax… While it does not carry the weight of law, the New York State Department of Taxation and Finance’s January 29 opinion has potentially far-reaching implications, given the state’s role as a trend setter for other states. The department asserts that an e-course offered by SkillSoft Corporation, a New Hampshire-based company, should be subject to sales tax as “software” purchased by the student.
If you are puzzled by how the New York State Department of Education equates an online learning course as purchased “software, ” read below:
…the department maintained that accessing the software online “constitutes a transfer of possession of the software, because the customer gains constructive possession of the software, and gains the ‘right to use, or control or direct the use of’ the software. … This is true even if no ‘copy’ of the software is transferred to the customer.’ ”
Just in case you’d like to register your opinion of this with the New York State Department of Taxation and Finance, here’s a link to their website.
Tags: Now 'U' Know, Online Learning, UMass AmherstPermalink | Trackback |
Print This Post
- If You’re in College, are You a Student or a Customer? Both?
- Please Welcome Our New Chief Technology Officer Patrick Jay Masson
- Free Access to Atomic Learning for Students
- A ‘Vote’ for Open Source
- Higher Education Accessibility
Comments
4 Responses to “NY State Taxation Department Aims to Collect Sales Tax on Distance Education Courses”
Share your comment:
Review our comment policy
|
|
Explore UMassOnline
Millions of minds. Thousands of Possibilities. Endless Opportunity. Learn how global students are woven together by a common thread, a quality education. Click here to watch the UMassOnline One World Class video.
Since it’s SkillSoft (and SkillSoft-like products) I am not as alarmed by this. Using SkillSoft is using a software license that you lease year-by-year even though no software changes hands. It’s like getting a software subscription to wikispaces, microsoft office online, or leasing an island on second life.
I would be more alarmed if instructor-led courses were being taxed.
You make a good point about how the SkillSoft product is different from other courses, but a concern is the slippery slope. Once this door is open, how do we prevent a similar tax being proposed for distance learning courses?
I guess the distinction then lies with what is educational? And do educational resources get taxed? For example, does my French textbook get taxed? If Not, then should Rosetta Stone get taxed? I understand the concern, but in my humble opinion it’s worth while to look at what gets taxed and what does not and why.
I actually agree with the writer in the fact where do we draw the line. I always believe its good to be proactive then reactive, and if we are to wait until these laws are in place to ring the alarm bells, it might be too late. Just look at what we have done to the economy by doing nothing all those years.