Creates the Out-of-State Sales Tax Collection Fund in the state treasury and dedicates certain proceeds from implementation as a result of a federal law which will require vendors located out-of-state to collect sales tax on their Internet, mail order, or other sales into the state. (gov sig) (OR SEE FISC NOTE SD RV)
Impact
The financial resources generated by this bill are designated for significant state needs. Specifically, 75% of the tax revenue will be allocated to support the operational expenses of public institutions of higher education in Louisiana, while the remaining 25% is earmarked for healthcare services. This allocation reflects a strategic investment in both education and health by directing new resources generated through updated sales tax obligations into crucial state services.
Summary
Senate Bill 111 proposes the establishment of the Out-of-State Sales Tax Collection Fund within the Louisiana state treasury. The key purpose of this fund is to manage the sales tax collected from out-of-state vendors as required by certain federal laws. The bill mandates that the Secretary of the Department of Revenue notify relevant state officials when a federal law obligates out-of-state vendors to collect Louisiana sales tax for their online and mail-order sales into the state. This approach is designed to ensure that Louisiana captures revenue from sales transactions occurring within its domain, irrespective of the vendor's location.
Sentiment
The sentiment around SB 111 appears to be generally supportive within the legislative context, particularly among advocates for education and healthcare. Supporters argue that this bill will enhance funding for vital services that benefit Louisiana residents, thereby advancing public interests in higher education and health. However, there may be concerns related to the implications for out-of-state vendors, as obligatory tax collection from them could lead to complexities in compliance, which may elicit pushback from affected business communities.
Contention
Though the bill aims to establish a new revenue stream, there could be contention around the fairness and practicality of imposing tax obligations on out-of-state vendors. Critics may argue that such regulations might discourage online businesses from selling to Louisiana consumers, potentially harming local consumers by limiting their choices. Furthermore, the administrative challenges of tax collection and remittance for these vendors may also be raised as a point of contention, showcasing the tensions between state revenue needs and business compliance.
Dedicates to the Better Highways and Higher Education Fund state sales tax proceeds collected each fiscal year as a result of a federal law requiring vendors located out-of-state to collect sales tax on their Internet and mail order sales. (gov sig) (OR SEE FISC NOTE GF RV See Note)
Dedicates to the Better Highways and Higher Education Fund state sales tax proceeds collected each fiscal year as a result of a federal law which will require vendors located out-of-state to collect sales tax on their Internet and mail order sales.
Creates the Better Highways and Higher Education Fund and dedicates a certain portion of state sales and use taxes from out-of-state vendors into the fund (RE SEE FISC NOTE GF RV See Note)
Constitutional amendment to authorize the state to levy and collect an additional state sales tax at the same rate as the state sales tax upon Internet and mail-order sales in lieu of local sales tax, all the proceeds of the tax to be distributed to each political subdivision and to dedicate the proceeds of a state tax on the same sales. (2/3 - CA13s1(A))
To provide for the payment of a vendor's compensation for the state sales and use tax collection and to dedicate certain state sales tax revenues (EN +$4,300,000 GF RV See Note)
Constitutional amendment to provide for taxation of Internet and mail-order sales and to provide for dedication and distribution of the proceeds. (2/3-CA13s1(A)) (1/1/16)