Requires that charges imposed by collection contractors for the collection of taxes due the Dept. of Revenue be deducted from the total amount of money collected from a tax debtor (OR -$3,000,000 GF RV See Note)
Impact
If enacted, HB 1076 will fundamentally alter the financial arrangements between the tax debtors and collection contractors. By prohibiting contractors from charging tax debtors any additional fees for collection, it aims to enhance fairness in tax collection practices. The bill's passage could lead to a more efficient tax collection process, as tax debtors would not be deterred by additional financial burdens when settling their debts. Furthermore, it may compel collection contractors to moderate their fees, knowing that they cannot directly charge the debtors and must instead negotiate contracts that align with the DOR's budget.
Summary
House Bill 1076 aims to amend the provisions governing the collection of state taxes, both in-state and out-of-state, by changing how charges by collection contractors are managed. The bill requires that any additional charges imposed by collection contractors for the collection of taxes to be deducted from the total amount of money collected from the tax debtor. This effectively removes the burden of these additional charges from the tax debtor, shifting the financial responsibility for these fees onto the Department of Revenue (DOR). This change is intended to make the debt collection process more equitable for taxpayers.
Sentiment
The sentiment surrounding HB 1076 reflects a desire for more transparent and fair practices in tax collection. Supporters argue that the bill protects vulnerable taxpayers from excessive fees that can complicate their financial situations, promoting a more responsible approach to tax collection. However, there may also be concerns from collection contractors about their potential revenue loss and the overall sustainability of their operations if they cannot charge fees directly to debtors. This creates a mixed response, with proponents praising consumer protection while critics warn of potential unintended consequences for the operational viability of debt collectors.
Contention
Notable points of contention regarding HB 1076 revolve around the financial implications for both the Department of Revenue and the collection contractors. Critics argue that by removing the ability to charge additional fees, collection contractors might either limit their services or increase the costs embedded in contracts with the DOR, which may ultimately reduce the effectiveness of tax collection efforts. Furthermore, the bill could face scrutiny regarding its implementation and oversight, with questions about how the DOR will handle contractor compensation moving forward, which remains to be seen.
Establish the fee to be charged by the Department of Revenue for the collection and enforcement of collection of sales and use taxes of other taxing authorities (EG INCREASE SG RV See Note)
Establishes the office of debt recovery at the Dept. of Revenue for the collection of delinquent debts owed to certain governmental entities (EN SEE FISC NOTE GF RV See Note)
Establishes the La. Debt Recovery Program at the Dept. of Revenue for the collection of delinquent debts owed to certain governmental entities (RE INCREASE SG EX See Note)
Authorizes municipal tax collectors to employ private counsel or an agency for collection of delinquent taxes and provides for the collection of a fee for such services (RE SEE FISC NOTE LF RV See Note)
Raises the limit on the value of claims approved by the Board of Tax Appeals that are to be paid from current tax collections (EN SEE FISC NOTE See Note)