On February 26, 2015, the District of Columbia (the “District”) enacted the Fiscal Year 2015 Budget Support Act of 2014 (the “Budget Support Act”) the result of which is, effective for taxable years beginning after 2014, the adoption of single sales factor apportionment, market-based sourcing, a “throwout” rule for receipts from sales of other than tangible personal property, and a reduced 9.4% tax rate for corporations and unincorporated entities. The Budget Support Act also expands the scope of services subject to sales tax to include such services as car washing, bottled water delivery services, and health-club services. Lastly, the Budget Support Act clarifies the definition of Qualified High Technology Company (“QHTC”) used for purposes of tax credits, the exemption from Unincorporated Business Tax, and the special 6% tax.

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