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Florida: Many Information Services Are Exempt

  • Jun 18, 2014 | Gail Cole

 Most information services are not subject to Florida sales tax.

Are sales of Simple Storage Services (S3) subject to Florida sales tax or gross receipts tax? What about sales of Elastic Compute Cloud (EC2) with Open Source Instance service or a Third Party Instance? Data transfer fees?

These questions were posed to the Florida Department of Revenue by a taxpayer seeking clarification in order to better comply with Florida tax laws. The response came in the form of a Technical Assistance Advisement, which “is binding on the Department only under the facts and circumstances described in the request….” In addition, “subsequent statutory or administrative rule changes or judicial interpretations … may subject similar future transactions to a different treatment than expressed in this response.”

That said, the response is illuminative:

  • Sales of an information service are not subject to sales tax or gross receipts tax.
  • The EC2 is considered an information service and is exempt whether sold as an “open source instance” or a “third party instance.”
  • Data transfer fees are considered information services and are therefore not subject to sales tax or gross receipts tax in Florida.

Interested in reading the fine print? The complete technical assistance advisement is available.

Different states tax cloud computing services differently. Learn how outsourcing sales tax makes it more manageable.

photo credit: heathbrandon via photopin cc

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.