The Multistate Tax Commission (MTC) held its annual Fall Meetings in Little Rock, Arkansas (Eversheds Sutherland attorneys attended the event, and a full report will be provided). On Thursday, November 17, the MTC's Executive Committee dissolved the State Intercompany Transactions Advisory Service (SITAS) Committee. The Committee’s purpose of facilitating information sharing and dialogue among interested states, as well as sponsoring training with respect to intercompany transactions, will now be managed through the MTC’s Audit and Litigation Committees.

The MTC’s SITAS Committee (which was formerly known as the Arm’s Length Adjustment Service Committee) was created in 2014. Due to lack of participation, the Committee went through a four-year hiatus. In 2021, the Committee geared back up, led by Committee Chair Krystal Bolton. This time around, interest in the Committee increased significantly. According to a survey presented by Ms. Bolton in 2021, approximately 71% of the respondents were interested in having SITAS facilitate audit exchange and collaboration. 

Because of the newfound interest in the Committee, SITAS was revamped with the purpose of providing support for states seeking to address tax base erosion of income due to inter-company transactions. Thereafter, the Committee notoriously updated the 2014 “State Intercompany Transactions Advisory Service Committee Participation Commitment and Exchange of Information Agreement,” which was made final in March of 2021 (and later revised in July of 2021).

The SITAS Committee last met in February of 2022, mainly to discuss a letter submitted by Eversheds Sutherland. The letter highlighted the importance of protecting taxpayer confidentiality when engaging in information sharing agreements. The Committee has not held a public meeting since. 

At its meeting on Thursday, November 17, 2022, the Executive Committee, on recommendation by Executive Director Greg Matson and SITAS Committee Chair Krystal Bolton, dissolved the SITAS Committee.

Eversheds Sutherland will continue to participate in all MTC Meetings, advocate for its clients and the business sector, and report any updates in a timely manner.

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