A software services tax that took effect July 31 has riled Massachusetts' solution provider community and has some rethinking plans to expand their business within the state. That's giving a black eye to Massachusetts politicians who like to brag about the state's high-tech industry.
The 6.25 percent services tax was part of a larger package of taxes and financing for the state's transportation system and was approved by the state's legislature and governor with little notice.
IT service and solution providers say the tax could apply to anything from building a website for a client to updating software on a customer's computer. There's a growing movement to repeal the tax. In the meantime, in the words of Michael Widmer, president of the Massachusetts Taxpayers Foundation: "Other states couldn't be asking for a greater opportunity."