Kentucky’s Streamlined Sales Tax (SST) project is paving the way to simplified sales and use tax collection and administration in the commonwealth. The successful initial implementation secures Kentucky's position at the forefront of this important nationwide tax change initiative.
"I am extremely proud of the dedication, hard work and expertise that was displayed by all those who helped make this project a success. Our developers had to make new technologies and legacy technologies work together and they did it."
- Mike Inman, Commissioner
Commonwealth Office of
The new SST system, a joint effort between the Commonwealth Office of Technology (COT) and the Department of Revenue, allows sellers from any state to file and pay Kentucky sales and use taxes online after registering on the national Web site. The system is also the first in Kentucky to utilize new technologies that will play a major role in the commonwealth's future application development efforts.
The national Streamlined Sales and Use Tax Agreement (SSUTA) went into effect on Oct. 1, 2005. States participating in the agreement face a number of challenges. One of the first challenges is developing the ability to accept taxpayer registrations from the National Registration System (NRS). A second and more difficult challenge is the ability to accept and process actual sales tax returns. Kentucky's new system is meeting both of these challenges and more.
When the national SSUTA took effect on Oct. 1, the new NRS was ready to begin accepting taxpayer registrations. Kentucky was one of only two states prepared to use the system at that time. The ability to accept sales tax returns came later, but Kentucky was again among the states leading the way. Taxpayers filing SST simplified returns in the commonwealth now have a new Kentucky SST Web site to guide them through the process.
The Technologies Behind Kentucky’s SST System
Kentucky's new SST system makes extensive use of Web services, including both host and client components. The Web services host application includes Kentucky’s first implementation of WebSphere 6.0 and the MQ Series Listener, both from IBM. In addition, the system uses the SST extensible markup language (XML) schema for exchanging data. The system also uses multiple programming languages and databases, and interfaces to existing legacy applications including some applications developed in the late 1970’s. Both Internet and Intranet Web sites are utilized as well. As a result of the experience gained on this project, Kentucky is now mentoring other states in the use of mainframe Web services technologies, and has adopted a service oriented architecture as its application architecture of the future.
More than 100 commonwealth employees played active roles in the Kentucky SST project since it began in March 2004. COT Commissioner Mike Inman commented, "I am extremely proud of the dedication, hard work and expertise that was displayed by all those who helped make this project a success. Our developers had to make new technologies and legacy technologies work together and they did it. Without each team member’s expertise, attitude, collaboration and dedication, this project could not have been so successful."
At the forefront of the national streamlined sales tax effort, the Kentucky SST project was nominated for the Best of Kentucky Technology Award in the category of Best Application Serving the Public. Since its initial implementation in October 2005, the system has realized more than a half million dollars in additional tax revenue for the commonwealth. Ultimately, the streamlined national agreement has the potential to generate millions in new sales and use tax receipts for Kentucky while reducing the processing time and personnel required to collect those taxes. It will also reduce the burden of tax administration significantly for taxpayers in Kentucky and around the nation.
The Kentucky SST Web site is available at https://rfo2zeus.state.ky.us/KrcIfile/SSTP/SSTLogin.aspx.