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Regular Session, 2012
HOUSE BILL NO. 971
BY REPRESENTATIVE BARROW
TAX/LEASE: Authorizes East Baton Rouge Parish to create an automobile rental tax
district
AN ACT1
To enact R.S. 47:551.1, relative to special districts; to authorize the establishment of an2
automobile rental tax district in East Baton Rouge Parish; to provide for the3
boundaries, governance, and powers of the district; to authorize the levy of a tax on4
the lease or rental of certain automobiles under certain circumstances; to provide for5
the use of the avails of the tax; to provide for an effective date; and to provide for6
related matters.7
Notice of intention to introduce this Act has been published8
as provided by Article III, Section 13 of the Constitution of9
Louisiana.10
Be it enacted by the Legislature of Louisiana:11
Section 1. R.S. 47:551.1 is hereby enacted to read as follows: 12
§551.1. Automobile rental tax district; East Baton Rouge Parish13
A.(1) The governing authority of the parish of East Baton Rouge may create,14
by ordinance, an automobile rental tax district, referred to in this Section as the15
"district". The district shall be a political subdivision of the state as defined in the16
Constitution of Louisiana.17
(2) The boundaries of the district shall be coterminous with the boundaries18
of the parish.19 HLS 12RS-1186 ENGROSSED
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(3) The parish governing authority shall be the governing authority of the1
district.2
B.(1)(a) The district is authorized to levy an automobile rental tax, not to3
exceed three percent of the gross proceeds derived from the lease or rental of an4
automobile pursuant to an automobile rental contract, less any sales and use tax5
included in such contract. The tax shall be in addition to any tax, fee, or license6
imposed directly or indirectly.7
(b) The tax shall be levied only after the question of its levy has been8
approved by a majority of the registered voters of the district who vote on the9
proposition authorizing the tax at an election held for that purpose in accordance10
with the Louisiana Election Code. The election on the question of the levy of the tax11
shall be held at the same time as a regularly scheduled election in the parish of East12
Baton Rouge.13
(c) The tax shall not apply to any automobile rented by an insurance14
company as a replacement vehicle for a policyholder or by an automobile dealer as15
a replacement vehicle while a customer's vehicle is being serviced or repaired, nor16
shall the tax apply to any individual or business who rents a vehicle as a replacement17
vehicle while his vehicle is being repaired if the individual presents to the renter18
upon return of the rented vehicle a copy of the repair or service invoice.19
(2) For purposes of this Section "automobile rental contract" shall mean all20
agreements for the rental of an automobile without a driver designated to carry less21
than nine passengers for a period of not more than twenty-nine calendar days. Rental22
agreements for a period of more than twenty-nine calendar days shall not be subject23
to the tax, unless the actual period of the rental agreement is less than twenty-nine24
days as a result of the exercise of a cancellation clause.25
C. The avails of the tax in East Baton Rouge Parish shall be distributed as26
follows:27
(1) Thirty percent to the Arts Council of Greater Baton Rouge for its28
operations.29 HLS 12RS-1186 ENGROSSED
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(2) Thirty percent to the Arts Council of Greater Baton Rouge for grants.1
(3) Twenty-three percent to the Shaw Center for the Arts.2
(4) Seventeen percent to the general fund of the parish of East Baton Rouge,3
city of Baton Rouge.4
D. The parish governing authority shall prescribe in the ordinance creating5
the district any other purposes of the district. The parish and the district may enter6
into a cooperative endeavor agreement providing for cooperative efforts to exercise7
any authorized governmental function of the parish.8
Section 2. This Act shall become effective upon signature by the governor or, if not9
signed by the governor, upon expiration of the time for bills to become law without signature10
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If11
vetoed by the governor and subsequently approved by the legislature, this Act shall become12
effective on the day following such approval.13
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Barrow HB No. 971
Abstract: Authorizes the governing authority of East Baton Rouge Parish to create an
automobile rental tax district.
Present law (R.S. 47:551) levies, for the period from Aug. 1, 1990, through June 30, 2012,
a state tax of 2-½% and a local tax of ½ of 1% of the gross proceeds derived from the lease
or rental of an automobile pursuant to an automobile rental contract, less any sales and use
tax included in such contract.
Present law excludes the following transactions from any tax that may be imposed:
(1)Automobiles rented by an insurance company as a replacement vehicle for a
policyholder.
(2)Automobiles rented by an automobile dealer as a replacement vehicle while a
customer's vehicle is being repaired.
(3)An automobile rental by an individual or business who rents a vehicle as a
replacement vehicle while his vehicle is being repaired if the individual presents to
the renter upon return of the rented vehicle a copy of the repair or service invoice.
Present law defines "automobile rental contract" to mean an agreement for the rental of an
automobile without a driver, designated to carry less than nine passengers, for a rental period
of not more than 29 calendar days. Provides that rental agreements in excess of 29 days HLS 12RS-1186 ENGROSSED
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shall not be subject to the tax, unless the actual period of the rental agreement is less than
29 days as a result of the exercise of a cancellation clause.
Present law provides that tax is payable to the secretary of the Dept. of Revenue. Requires
that the tax be collected and enforced pursuant to the provisions of present law (Chapter 2
of Subtitle II of Title 47 of the La. Revised Statutes of 1950) insofar as the provisions are
not in conflict with present law (R.S. 47:551).
Present law requires that the local tax be remitted to the secretary of the Dept. of Revenue
who collects the tax as an agent of local government. Authorizes the secretary to assess a
collection fee, not to exceed ½ of 1% of the proceeds of the tax, as reimbursement for the
actual cost of collection.
Present law requires the secretary to distribute monthly the proceeds of the tax to the central
local sales and use tax collector or, if none, the parish governing authority. Requires the
central local sales and use tax collector or governing authority to distribute at no charge the
tax proceeds received from the secretary to each political subdivision in the parish which
levies a sales and use tax. Provides that the distribution shall be in accordance with each
political subdivision's pro rata share of local sales and use tax receipts collected to the total
of all such taxes collected within the parish. Provides specifically for the distribution of
proceeds in the parishes of Jefferson and Orleans.
Proposed law retains present law and additionally authorizes the governing authority of East
Baton Rouge Parish to create, by ordinance, an automobile rental tax district as a political
subdivision of the state. Provides that the boundaries of the district shall be coterminous
with the boundaries of the parish. Provides that the parish governing authority shall be the
governing authority of the district.
Proposed law authorizes the district, subject to voter approval, to levy an automobile rental
tax, not to exceed 3% of the gross proceeds derived from the lease or rental of an automobile
pursuant to an automobile rental contract, less any sales and use tax included in such
contract. Requires that the election on the question of the levy of the tax be held at the same
time as a regularly scheduled election in East Baton Rouge Parish.
Proposed law excludes the same transactions as present law (R.S. 47:551) from any tax that
may be imposed. Defines "automobile rental contract" to mean the same as defined in
present law (R.S. 47.551). Provides that rental agreements in excess of 29 days shall not be
subject to the tax, unless the actual period of the rental agreement is less than 29 days as a
result of the exercise of a cancellation clause.
Proposed law requires that the avails of the tax in East Baton Rouge Parish be distributed as
follows:
(1)30% to the Arts Council of Greater Baton Rouge for its operations.
(2)30% to the Arts Council of Greater Baton Rouge for grants.
(3)23% to the Shaw Center for the Arts.
(4)17% to the general fund of the city of Baton Rouge/parish of East Baton Rouge.
Proposed law requires the parish governing authority to prescribe in the ordinance creating
the district any other purposes of the district.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Adds R.S. 47:551.1) HLS 12RS-1186 ENGROSSED
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Summary of Amendments Adopted by House
Committee Amendments Proposed by House Committee on Municipal, Parochial and
Cultural Affairs to the original bill.
1. Relative to the creation of an automobile rental tax district, specifies that the
governing authority of East Baton Rouge Parish is authorized to create a district
by ordinance. Specifies that a district is a political subdivision of the state.
2. Requires voter approval prior to the levy of a tax by a district and provides
relative to the time for holding a tax election.