Case Study: Physical Presence In Hawaii

1587 Words 7 Pages
3. The Company’s Business can be Differentiated from the Case Law

a. The Company does not have Physical Presence in Hawaii

The Company itself does not have a physical presence in Hawaii. The CRNAs, who are independent contractors (some operating as separate business entities), performed all the services related to the contract with the Facility, in Hawaii. As discussed in the facts above, the Company is essentially a temporary contracting organization. Its mission is to connect Facilities in need of services with CRNAs looking for work. The Company negotiated all terms, and fulfilled its obligations to the contract, from outside of Hawaii. Aside from its business relationship with the CRNAs, the Company had zero physical presence in Hawaii.
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In Grayco, the taxpayer held legal title to property located in Hawaii. In Baker & Taylor the taxpayer engaged in active solicitation by sending employee representatives to meet potential and current purchasers of its products. The taxpayer also provided software and training for purchasing and cataloging its materials in Hawaii. Its representatives visited Hawaii on an ongoing basis to support its customers, as part of its effort to maintain its business in Hawaii. In Heftel Broadcasting the taxpayer owned and rented film prints and their telecast rights within …show more content…
In other words, the conduct of the independent representatives in Washington created a tax nexus between the taxpayer and the state. The taxpayer used these representatives in the state to solicit sales, provide the company with local marketing information, and to maintain and foster close relationships with the corporation’s Washington customers. Through this contact and these close relationships, the taxpayer was able to maintain and improve name recognition, market share, and company goodwill inside the

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