Electronic tax

Bills call for voluntary simplification of Louisiana sales tax system

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A state constitutional amendment Seeking to streamline Louisiana’s decentralized sales tax system is pending at this year’s session.

Voters rejected a similar measure last year, so even if the Senate approves the bill passed by the House, change is by no means assured. However, two bills that have passed the Senate could address some of the complaints business owners have about the current system, although local authorities are expected to adhere to them.

Senate Bill 95 by Sen. Bret Allain, R-Franklin, who chairs the Revenue and Fiscal Affairs Committee, calls on the Uniform Local Sales Tax Council to create a multi-parish audit program for local sales tax. Companies that do business in multiple jurisdictions may face multiple audits of their sales tax collections. This can be costly and time-consuming for businesses, although many local officials are reluctant to waive this right.

“You are betting on the hope that local parishes will engage,” says Jason DeLeather, a consultant who works with legislators on tax issues. “But until the constitution changes, you can’t force it.”

from Alain Senate Bill 235 would allow local authorities to opt to have all their taxes collected by the Distance Sellers Commission, which collects sales tax on online sales. Again, this is a statutory way to simplify the system somewhat without changing the constitution, DeCuir says.

DeCuir, who began his career as a tax attorney and spent three years with the Louisiana Department of Revenue, says there’s a good chance Louisiana’s system will eventually will be declared unconstitutional under the United States Supreme Court Wayfair Standard. The fact that state officials felt the need to create a centralized online sales tax collector indicates that the main system is too complex, he suggests.