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Tax Law

Legal Alert: MTC Executive Committee Fall Meeting Update—SITAS Committee Regroups and Amended P.L. 86-272 Statement Moves Forward

On November 20, the Executive Committee of the Multistate Tax Commission (MTC) met via videoconference for its final meeting of 2020. During the meeting, the Committee heard updates from Greg Matson (MTC Executive Director) and each of the MTC’s standing committees, including the State Intercompany Transactions Advisory Service (SITAS) Committee. Here are the highlights.

Krystal Bolton (Louisiana Department of Revenue) presented to the Committee, noting she recently agreed to serve as chair of the SITAS Committee and described Louisiana as having “been a state on the forefront of using transfer pricing as a tool in its audit program” in her report. She also noted that the Committee plans to hold a meeting January 2021, during which the Committee intends “to discuss ways the Committee can support member states and to discuss the possibility of holding a training and information session in 2021.”

The Committee also received a report from the hearing officer for the updates to the MTC’s P.L. 86-272 Statement of Information, Robert J. Desiderio. Since the MTC first launched the project in November of 2018, an MTC work group has drafted amendments to the MTC’s “Statement of Information Concerning Practices of the Multistate Tax Commission and Signatory States under Public Law 86-272.” The statement was last updated in 2001, and it acts as the MTC’s and the signatory states’ position on the application of P.L. 86-272. Spurred by the Wayfair decision, the work group was tasked with considering how P.L 86-272 “applies to modern business activities,” according to a June 17, 2020 Memo by Brian Hamer (MTC). The ultimate result of the revisions was the gutting of any P.L. 86-272 protection for any company with an interactive website, based on the customer’s activity with the company’s website.

Read our full Legal Alert here.