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)]
CONFERENCE COMMITTEE REP ORT DIGEST
HB 62 2016 First Extraordinary Session Jackson
Keyword and oneliner of the instrument as it left the House
TAX/SALES-USE, STATE: Impose a one cent sales and use tax (Item #9)
Report adopts Senate amendments to:
1. Exempt or exclude the following from the imposition of the new tax:
a. Sale of material for further processing.
b. Transactions in interstate commerce.
c. Advertising services.
d. A certain value for new farm equipment used in poultry production.
e. A certain value for a factory built home.
f. A certain value for the printing of news publications.
g. Lease of a crane and related equipment with an operator.
h. Vehicle rentals for re-rental to warranty customers.
i. Sale of manufacturing machinery and equipment.
Report rejects Senate amendments which would have:
1. Established a dollar value trigger for incremental reductions in the tax rate under certain
circumstances.
2. Extend the sunset date for the new tax from Oct. 1, 2017 to April 1, 2021.
3. Expand the sales and use tax exemption for private contractors for shipbuilding to include
vessels built for the U.S. Coast Guard.
Report amends the bill to:
1. Add the following to the list of exclusions and exemptions: a. Sale of livestock at a public sale or auction market.
b. Sale of livestock, poultry, and other farm products direct from the farm.
c. Sale of agricultural products by a person other than the producer, for use in further
processing.
d. A certain value for new farm equipment.
e. Sale of pharmaceuticals administered to livestock.
f. Materials and supplies used in the production of crawfish and catfish.
g. Sales of trucks and trailers if used at least 80% of the time in interstate commerce.
h. Sales of ships, vessels, barges, and all related supplies and expenses.
i. Sales by and to the state and its political subdivisions.
j. Sale of freight cars, piggy-back cars, rail rolling stock, and railroad ties.
k. Purchases by a council on aging.
l. Provide that the exclusion for manufacturing machinery and equipment shall begin on July
1, 2016.
2. Provide that the avails of the new tax shall not be subject to dedication or distribution for any
tax increment financial district or economic development project.
3. Change the sunset date from October 1, 2017 to June 30, 2018.
4. Change the effective date from governor signature to April 1, 2016.
Digest of the bill as proposed by the Conference Committee
Proposed law imposes a new 1% state sales and use tax upon the sale at retail, the use, the
consumption, the distribution, and the storage for use or consumption in this state of each item or
article of tangible personal property as well as certain services.
Proposed law imposes the tax from April 1, 2016, through June 30, 2018. The tax shall cease to be
effective on July 1, 2018.
Present law establishes a dedication for economic development activities of an amount equal to
0.004% of all state sales and use tax annual collections that remain after satisfaction of the
requirements of the present constitution for the Bond Security and Redemption Fund. Of that
amount, $2 million is deposited into the Marketing Fund, which is a special fund within the state
treasury for the support of various specific economic development organizations. All monies in
excess of the Marketing Fund allocation are deposited into the La. Economic Development Fund,
which is a special treasury fund to support a wide variety of economic development activities.
Proposed law adds to present law by specifying that the dedication of sales tax provided in present
law shall not apply to the avails of the new tax.
Present law provides definitions for terms used for purposes of state and local sales and use tax, which include specific exclusions from the tax base. Present law also establishes a wide variety of
exemptions from state sales and use taxes.
Proposed law, notwithstanding any other provision of present law authorizes only the following
exclusions and exemptions applicable to the new tax:
(1)Food for home consumption, including soft drinks, bakery items, fresh product, and dairy
products.
(2)Natural gas used for residential purposes.
(3)Electricity, used for residential purposes.
(4)Water used for residential purposes.
(5)Prescription drugs.
(6)Motor fuels subject to the state excise tax on motor fuels.
(7)Sales to the United States government.
(8)Other constructions permanently attached to the ground.
(9)Installation charges on tangible personal property.
(10)Installation of oil field board roads.
(11)Transactions involving the construction or overhaul of U.S. Navy and Coast Guard vessels.
(12)Property purchased for exclusive use outside the state.
(13)Purchases and leases of durable medical equipment under the provisions of Medicare.
(14)Sales of human tissue transplants.
(15)Sales of raw agricultural products.
(16)Sales of food by youth serving organizations chartered by congress.
(17)Tangible personal property sold to food banks.
(18)Materials used in the collection of blood.
(19)Aphaeresis kits and leuko reduction filters. (20)Donation to schools and food banks from resale inventory.
(21)Manufacturers rebates on new motor vehicles.
(22)Lease or rentals of railroad rolling stock.
(23)Purchases and leases by free hospitals.
(24)Purchases by nonprofit entities that sell donated goods.
(25)Sales of tangible personal property for resale.
(26)Purchases of property for lease or rental.
(27)Isolated or occasional sales of tangible personal property.
(28)Use of motor vehicles in Louisiana by active duty military.
(29)Purchases made with food stamps and WIC.
(30)Articles traded in on purchases of tangible personal property.
(31)Donations of toys.
(32)Stocks, bonds, notes or other obligations or securities.
(33)Credit for sales and use taxes paid to other states on tangible personal property imported in
La.
(34)Work product of certain professionals.
(35) Purchases by regionally accredited independent educational institutions.
(36)Sales through coin-operated vending machines.
(37)Purchases by a private postsecondary academic degree-granting institution.
(38)Purchases of food items for school lunch or breakfast programs by nonpublic elementary or
secondary schools.
(39)Repair services performed in La. when the repaired property is exported.
(40)Funeral directing services.
(41)Sales of feed and feed additives for animals held for business purposes. (42)Sales of farm products produced and used by farmers.
(43)Sales of fertilizers and containers to farmers.
(44)Sales of seeds for planting crops.
(45)Sales of pesticides for agricultural purposes.
(46)Sales of materials for further processing.
(47)Transactions in interstate commerce and tangible personal property imported into this state,
or produced or manufactured in La. for export.
(48)Any advertising service rendered by an advertising business.
(49)The price of a factory built home.
(50)The cost price for the printing of a news publication.
(51)The definition of "lease or rental" for purposes of the lease or rental of a crane and related
equipment with an operator.
(52)The sales price for new farm equipment used in poultry production.
(53)The gross proceeds derived from the sale of livestock at public sales sponsored by breeders'
or registry associations or livestock auction markets.
(54)Vehicle rentals for re-rental to warranty customers.
(55)Sales of trucks, trailers, and buses if used at least eighty percent of the time in interstate
commerce.
(56)Sales of ships, vessels, barges, and related supplies.
(57)Purchases by a council on aging.
(58)Sale of materials and supplies used in the production of crawfish and catfish.
(59)Sale of pharmaceuticals administered to livestock.
(60)The first $50,000 in value of certain new farm equipment.
(61)Sale of livestock, poultry, and other farm products direct from the farm.
(62)Sale of agricultural products by a person other than the producer, for use in further processing.
(63)Sales by and to the state and its political subdivisions.
(64)Sale of freight cars, piggy-back cars, rail rolling stock, and railroad ties.
(65)Sales of manufacturing machinery and equipment, beginning July 1, 2016.
Proposed law provides that the avails of the new tax shall not be subject to dedication or distribution
for any tax increment financial district or economic development project.
Proposed law terminates on June 30, 2018.
Applicable for taxable periods beginning on and after April 1, 2016.
Effective April 1, 2016.
(Amends R.S. 47:301(3), (7), (10), (13), (14), (16), (18) and (28) and 318(A); Adds R.S. 47:321.1)