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Louisiana Legislature sends centralized sales tax amendment to voters

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By David Jacobs | The Center Square

(The Center Square) – The Louisiana Legislature voted Thursday to create a single statewide board to oversee state sales tax collection, though voter approval and more legislation still are needed.

The House and Senate both gave final passage to Speaker Clay Schexnayder’s House Bill 199, a proposed constitutional amendment to create the State and Local Streamlined Sales and Use Tax Commission. Amending the state constitution requires the support of at least two-thirds of the members of both chambers and a majority of voters but not the governor’s signature.

Louisiana is one of only three states without a centralized sales tax collector. Local officials have collected local taxes. They have argued doing so ensures they get their revenue in a timely manner and can spend the money they way local taxpayers and voters want it spent.

Business advocates, however, contend the system is too complex and difficult to navigate, particularly for small businesses. Companies that do business in multiple jurisdictions have to deal with – and potentially be audited by – multiple collectors.

“Each parish in Louisiana oversees its own sales tax collection, audits, rates and even interpretations of what is taxed,” the Public Affairs Research Council of Louisiana said in a 2018 report. “No other state has this degree of local independence and control of its sales tax system.”

Under HB 199, the state still would not have full control of sales tax collection, which is important to many local officials. The eight-member commission would have four representatives of state government and four representing local government. The commission would be tasked with streamlining collections, simplifying the audit process and giving policy advice relative to sales taxes.

Usually bills that call for a constitutional amendment are paired with a separate bill laying out the companion statute that would go into effect. HB 199 doesn’t have a statutory companion, which means legislators would have to work out some of the details in a future session.

Schexnayder called HB 199 “the first step in bringing Louisiana in line with the rest of the country.”

“We’ve been trying to do this for nearly forty years and today we did it,” he said in a prepared statement.

The public vote will be held this fall. The House approved Senate Bill 149 Thursday, which calls for a special election for proposed constitutional amendments in October at an expected cost of $2 million.

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