The original instrument and the following digest, which constitutes no part of the
legislative instrument, were prepared by Riley Boudreaux.
DIGEST
SB 199 Original 2015 Regular Session Gallot
In-Lieu Sales Tax
Present constitution authorizes "local governmental subdivisions" (defined as parishes and
municipalities) and school boards to levy sales and use taxes.
Present constitution authorizes the legislature to grant tax authority to political subdivisions and
special districts.
Proposed constitutional amendment authorizes the state to provide by law for the levy and collection
of an additional sales and use tax at the same rate as the state sales and use tax upon sales into the
state by vendors who engage in the regular or systematic solicitation of consumers in this state, but
who have no employees, solicitors, agents, inventory, sales locations, or other business assets in the
state. The tax is to be levied and collected in the same manner as is provided by law for the levy and
collection of the state sales tax. The avails of the tax must be distributed to each political subdivision
in the manner provided by law. Such taxable transactions are excluded from the sales tax of political
subdivisions.
Dedication of Internet and Mail-Order Sales Tax
Proposed constitutional amendment requires the secretary of the Department of Revenue to provide
written notification to the commissioner of administration and to the chairs of the Senate Committee
on Finance and the House Committee on Appropriations of the following:
(1)The effective date of any federal law which the secretary determines will directly or
indirectly cause or require vendors located out-of-state to collect and remit Louisiana state
sales and use tax on their Internet, mail-order, or other sales into the state.
(2)That he has determined that the provisions of the proposed constitutional amendment
expanding the definition of "dealer" (below) has caused a substantial increase in the
collections of state sales and use tax on Internet, mail-order, or other sales into the state.
Proposed constitutional amendment creates the Out-of-State Sales Tax Collection Fund in the state
treasury to receive the estimated amount of state sales and use taxes collected from vendors located
out-of-state on Internet, mail-order, or other sales into the state because of such federal law or
because of the provisions of the proposed constitutional amendment expanding the definition of
"dealer" (below).
Proposed constitutional amendment provides that the money in the fund shall be appropriated by the legislature to be allocated and restricted to the following purposes:
(1)75% shall be used for public institutions of higher education for operational expenses.
(2)The remaining 25% shall be used for the provision of health care services.
Proposed constitutional amendment provides that interest earnings on the fund shall be credited to
the fund and all unexpended and unencumbered monies in the fund at the end of the fiscal year shall
remain in the fund.
Redefining "Dealer" to Include Internet and Mail-Order Sales
Proposed law, in addition to present law existing on the effective date of the proposed constitutional
amendment, in order to expedite the collection of the sales tax and use tax on Internet and mail-order
sales, requires the following individuals or entities to be considered a "dealer" responsible for
collecting any use tax in the manner provided for by law:
(1)Any seller, or seller's subsidiary, transacting business in this state at a place or a location of
business, or by having an independent contractor or any individual or entity operating under
the authority of or through an agreement with him irrespective of whether such place or
location of business, or independent contractor, person, or entity is located in this state
permanently or temporarily, or whether such seller or seller's subsidiary is qualified to do
business in this state.
(2)Any seller soliciting business through or pursuant to an agreement with a Louisiana resident
or business under which the resident or business, for consideration as an independent
contractor or representative, refers potential customers, whether by link on an Internet
website or otherwise, to the seller, or the seller's entity's subsidiary.
(3)Any seller for four quarterly periods has a cumulative total of sales in this state exceeding
$250,000 and more than 100 sales delivered in this state, unless the seller cannot reasonably
be expected to have the same delivered in this state for the next succeeding four quarterly
periods.
(4)Any seller who:
(a) Sells the same or substantially similar line of products as a Louisiana retailer under
the same or a substantially similar business name, using the same trademarks, service
marks, or trade names that are the same or substantially similar to those used by the
Louisiana retailer.
(b)Uses the facilities or employees of a Louisiana retailer to advertise or promote sales
to Louisiana purchasers, or to facilitate returns, issuance of refunds or credits, or
adjustments on property sold by the seller. (c)Solicits business and develops and maintains a market in Louisiana through an agent,
salesman, independent contractor, solicitor, or other representative pursuant to an
agreement with a Louisiana resident or business, hereinafter referred to collectively
as "affiliated agent", under which the affiliated agent, for consideration engages in
activities in this state that inure to the benefit of the seller in the seller's development
or maintenance of a market for its goods or services in the state, to the extent that
those activities of the affiliated agent are sufficient to satisfy the nexus requirement
of the U. S. Constitution. The activities of the affiliated agent includes referral of
potential customers to the seller, either directly or indirectly, whether by link on an
Internet website or otherwise.
(5)The secretary of the Department of Revenue is to presume that the criteria for a "dealer"
(above) applies to any seller which holds a substantial ownership interest, directly or through
a subsidiary, in a retailer maintaining sales locations in Louisiana; or to any entity which is
owned in whole or in substantial part by a retailer maintaining sales locations in Louisiana,
or by a parent or subsidiary thereof.
"Substantial ownership interest" is defined as affiliated sellers with respect to each other
where one of such sellers has an ownership interest of more than 5%, whether direct or
indirect, in the other, or where an ownership interest of more than 5%, whether direct or
indirect, is held in each of such sellers by another seller or by a group of other sellers, which
are affiliated sellers with respect to each other.
(6)Such "dealers" must file all applicable sales tax returns and remittances through electronic
filing options available for such purposes as provided by law.
(7)The provisions of this portion of the proposed constitutional amendment shall not be used
in the determination of whether such sellers are liable for the payment of income and
franchise taxes.
(8)Changes affecting any of the provisions of this portion of the proposed constitutional
amendment may be made by a law enacted by a favorable vote of 2/3 of the elected members
of each house of the legislature.
Effective January 1, 2016.
Specifies submission of the amendment to the voters at the statewide election to be held on October
24, 2015.
(Adds Const. Art. VII, Sec. 2.4)