- Indiana ruled that generative AI services, such as AI chatbots accessed online, are not subject to sales tax.
- The decision is based on the fact that these services do not involve transfer of tangible personal property, prewritten software, or digital products with permanent ownership.
- Software as a Service (SaaS) is not taxable in Indiana if customers do not gain permanent ownership or control of the software.
- Other states may issue different rulings, especially those that tax SaaS or digital products.
- Businesses should monitor state-specific guidance as AI-related tax rules continue to evolve.
Source: aprio.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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