Pugh HB No. 355
(KEYWORD, SUMMARY, AND DIGEST as amended by Senate committee
amendments)
TAX/SALES-USE, STATE. Provide for the collection of sales and use taxes due on
sales made in Louisiana by a remote dealer.
DIGEST
HB 355 Reengrossed 2015 Regular Session Pugh
Present law levies an additional 4% state sales and use tax to be collected only by a person
who qualifies as a dealer in La. solely by virtue of engaging in regular or systematic
solicitation of a consumer market in La. by the distribution of catalogs, and other print media,
radio, television, and other electronic and digital media.
Present law provides various definitions of "dealer" with respect to sales and use tax law and
defines "engaging in business in a taxing jurisdiction".
Proposed law retains present law and expands the definition of dealer for purposes of the
collection of the additional 4% state sales and use tax to include the following activities and
attributes:
(1)The solicitation of business through an independent contractor or any other
representative pursuant to an agreement with a La. resident under which the resident,
for a commission, referral fee, or other consideration of any kind, directly or
indirectly refers potential customers, whether by website link, personal presentation,
telemarketing, or otherwise, to the seller. For purposes of qualification as a "dealer"
through an agreement with a La. resident to maintain a business in La., the
presumption that a person is a dealer, based upon annual gross receipts from sales of
property delivered in La. that exceed $50,000, is rebuttable if the person can
demonstrate that he cannot reasonably be expected to have gross receipts in excess
of $50,000 in the following 12 months.
(2)Sale of the same or a substantially similar line of products as a La. retailer under the
same or substantially similar business name.
(3)Holding a substantial ownership interest, directly or through a subsidiary, in a retailer
maintaining sales locations in La. or who is owned in whole or in substantial part by
a retailer maintaining sales locations in La.
(4)Solicitation of business or maintenance of a market in La. through an agent,
salesman, independent contractor, or other representative (affiliated agent), through
an agreement with the dealer.
Proposed law limits the collection of the tax from such dealers to the Department of Revenue
and prohibits a La. retailer from collecting the additional 4% state sales and use tax in lieu
of the sales and use tax levied by a political subdivision and remitted to the political
subdivision.
Proposed law allows any taxpayer from whom a dealer has "actually collected and remitted"
the state 4% in lieu of the local sales tax to obtain a refund if within 30 days from the
remittance of the tax the taxpayer provides the secretary with either of the following:
(1)A certified copy of a use tax return that has been filed with the relevant parish sales
and use tax collector concerning the same transaction, together with the proof of
payment of all state and local use taxes due on the transaction.
(2)A certified copy of an affidavit that has been filed with the sales and use tax
commission provided in present law as an advisory commission, in a form prescribed
Page 1 of 3
Prepared by Riley Boudreaux. by the commission, affirming that the delivery and all use of the property subject to
tax will be in a parish with no use tax imposed by any local taxing authority.
Proposed law requires persons who meet the definition of a dealer under proposed law to
electronically file tax returns and remittances to the state and local taxing authorities.
Proposed law prohibits the determination that certain business activities establishes a person
as a dealer for purposes of sales and use tax from being used in a determination of whether
the person is liable for the payment of state income or franchise taxes.
Present law requires the secretary of the Dept. of Revenue to annually distribute the avails
of the tax to parish governing authorities based on population, which monies are then
distributed to the local taxing authorities in the respective parish.
Proposed law retains present law, but changes the frequency of distributions by the secretary
to the parishes from annually to quarterly.
Proposed law provides that if the U.S. Congress enacts legislation authorizing states to
require a remote seller to collect sales taxes on taxable transactions, the federal law shall
preempt the provisions of proposed law. Further, directs the secretary of the Dept. of
Revenue to promulgate rules to carry out the provisions of the federal law within 90 days of
its effectiveness. However, the Dept. of Revenue, for purposes of the promulgation of the
rules, shall consult with the sales and use tax commission established under present law for
purposes of the distribution of the proceeds of the additional 4% state sales and use tax to the
parishes.
Applicable to tax periods beginning on and after July 1, 2015.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Amends R.S. 47:302(K)(5), (7)(a) and (U); adds R.S. 47:302(V))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Ways and Means to the
original bill:
1. Add to the definition of "dealer" with respect to methods of transacting and
solicitation of business.
2. Change the threshold level of sales activity for purposes of the definition of
"dealer" from a cumulative total of $250,000 or 100 sales of tangible personal
property in one year to $50,000 in sales of tangible personal property in one year.
3. Specify that the provisions of proposed law shall apply to tax periods beginning
on and after July 1, 2015.
4. Add provisions that if the U.S. Congress enacts legislation authorizing states to
require a remote seller to collect sales taxes on taxable transactions, the federal
law shall preempt the provisions of proposed law. Further, directs the secretary
of the Dept. of Revenue to promulgate rules to carry out the provisions of the
federal law within 90 days of its effectiveness.
The House Floor Amendments to the engrossed bill:
1. Add a prohibition that a La. retailer shall not collect the additional 4% state sales
and use tax in lieu of collecting the sales and use tax imposed by a political
subdivision.
2. Change the frequency for the distribution of the proceeds of the additional 4%
state sales and use tax by the Dept. of Revenue to parishes from annually to
quarterly.
Page 2 of 3
Prepared by Riley Boudreaux. 3. Add a requirement that before promulgation of rules for purposes of
implementing federal law with regard to collection of state and local sales and
use taxes on sales involving remote dealers, the Dept. of Revenue shall consult
with the sales and use tax commission for purposes of the distribution of the
proceeds of the additional 4% state sales and use tax to the parishes.
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Revenue and Fiscal Affairs
to the reengrossed bill
1. Limits the collection of the tax from dealers defined in the proposed law to the
Department of Revenue.
2. Provides a procedure for making refunds to taxpayers who have paid the local tax
or who are in a parish with no use tax imposed by any local taxing authority.
Page 3 of 3
Prepared by Riley Boudreaux.