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Court says Wisconsin was right to tax software sale to Menasha Corp.

Knight Ridder/Tribune Business News, October, 2004

By Avrum D. Lank, Milwaukee Journal Sentinel Knight Ridder/Tribune Business News

Oct. 29--The Dane County Circuit Court has handed the state a victory in a $260 million tax dispute that has sweeping implications for companies that modify off-the-shelf software.

Judge Steven D. Ebert ruled Tuesday that the Wisconsin Department of Revenue was correct in collecting sales tax on a multimillion dollar company-wide software system sold by German software vendor SAP to the Menasha Corp. in the middle 1990s.

Ebert ruled that the programs were off-the-shelf software, which is subject to sales tax.

Menasha argued that the changes it made to the programs categorized them as "customized software," which is tax exempt.

The ruling...

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