Louisiana voters will decide the fate of a constitutional amendment later next month that aims to provide a uniform and simplified statewide system for collecting sales taxes, a change supporters say would improve the state’s business climate.
Passage of Amendment 1 on the Nov. 13 ballot would also place the taxation of online product sales on par with purchases at brick-and-mortar stores, making small businesses’ transactions on an equal footing with online purchases, according to supporters.
The measure would create the State and Local Streamlined Sales and Use Tax Commission, whose members would be appointed by the Louisiana School Boards Association, Louisiana Municipal Association, Policy Jury Association of Louisiana, Louisiana Sheriffs’ Association, the state Department of Revenue, legislative leaders and the governor.
“As Louisiana is one of only four states that lacks unified sales tax administration, this change would be an important step forward,” an analysis of Amendment 1 by the Washington, D.C.-based Tax Foundation states. “Currently, sellers must remit tax to 64 taxing jurisdictions – a costly and burdensome task.”
Also supportive of the reform is the Pelican Institute for Public Policy in New Orleans.
“Louisiana is an outlier in many categories, but our tax system's complexity drives jobs and opportunities out of our state,” Pelican Institute CEO Daniel Erspamer told the Louisiana Record in an email. “In order to make us more competitive with our neighbors and to encourage job growth for Louisiana families, it is critical that we pass Amendment 1 to streamline our sales tax collection process. "
A related measure on the ballot, Amendment 2, would cut the state’s individual and corporate income tax rates from 6% to 4.75%. That reform would also end Louisiana’s mandatory deduction of federal income tax.
Amendment 1 would also eliminate the state’s Sales and Use Tax Commission for Remote Sellers and the Louisiana Uniform Local Sales Tax Board within a year of the new commission’s first meeting. In addition, the new panel would have the power to issue advice about sales and use taxes for all tax authorities and to provide guidance and rules to streamline audit processes.
Early voting in the Nov. 13 election begins on Oct. 30.