Minn. sales tax ruling stands; up to $17M on line

ST. PAUL, Minn. (AP) — A ruling that went against Minnesota government in a long-running sales tax dispute will stand, potentially costing the state $17 million in revenue.

Revenue Department Deputy Commissioner Matt Massman told The Associated Press on Tuesday that the agency won’t appeal a September court ruling. It’s a victory for software company SAP Retail, which opposed more than $500,000 in sales tax assessments. But the state might be out money from companies that are similarly situated. The state expects $17 million to be its maximum exposure.

SAP sold software to Best Buy, which also purchased consulting services to customize it. In 2010, the Revenue Department determined SAP owed extra sales tax because the consulting services were not specifically exempted from the tax. The company appealed to the Tax Court and won.

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