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TaxByte: Colorado Begins Taxing Digital Products as Tangible Personal Property Starting June 23rd, 2021 | TaxValet

Written by Alex Oxford, CMI | Jul 26, 2021 3:07:33 PM

Colorado’s Governor signed H.B. 1312 on June 23, 2021, bringing the law into line with the state’s practice of levying sales and use tax on digital items. The new Colorado Revised Statutes broaden the definition of tangible personal property to incorporate all goods, wares, and commodities, including digital items regardless of delivery mode.

Digital goods are defined as “any item of tangible personal property that is delivered or stored by digital means, including but not limited to video, music, or electronic books.” The state previously incorporated a similar definition of digital goods as tangible personal property in the Colorado Code of Regulations effective January 2021. 1 Code Colo. Regs. 39-26-102(15)) (Colorado H.B. 1312; 1 Code Colo. Regs. 39-26-102(15))

You can read the original text of the statute change by clicking here.