On September 12, the Arizona Supreme Court declined to take review in ADP, LLC v. Ariz. Dep’t of Revenue, No. CV-23-0036-PR., which lets stand the Arizona Court of Appeals decision upholding the taxation of SaaS. 254 Ariz. 417, No. 1 CA-TX 21-0009 (Ariz. Ct. App. Jan. 31, 2023).

This is significant because the Arizona Department of Revenue now has the court’s blessing to tax software-as-a-service (“SaaS”) transactions as sales or rentals of tangible personal property despite no clear Arizona statutory authority to tax digital goods and services.