Louisiana House Bill HB295

Louisiana 2016 Regular Session

• Introduced: 3/2/16
• Refer: 3/2/16
• Refer: 3/14/16

Caption

Provides for the sales and use tax payable on sales made from a remote dealer when the tax was not collected at the point of sale

Impact

If enacted, this bill will change the current reporting process for use taxes in Louisiana. Starting January 1, 2017, taxpayers will be required to openly acknowledge their use tax responsibilities when filing their income taxes, which could increase compliance and tax revenue for the state. The provisions of HB295 also clarify that purchases made by businesses are excluded from these requirements, focusing enforcement on individual consumers instead. This distinction could help streamline the collection process for individuals while preserving existing obligations for businesses.

Summary

House Bill 295 aims to enhance the collection of sales and use tax on purchases made by Louisiana taxpayers from remote sellers when the seller did not collect the tax at the point of sale. The bill introduces a mandatory checkoff system on individual state income tax returns, allowing taxpayers to estimate and report their use tax liabilities based on taxable goods and services purchased during the tax year. This regulation is intended to level the playing field for Louisiana retailers by ensuring that out-of-state sellers are treated similarly to local dealers regarding tax obligations.

Sentiment

Overall sentiment around HB 295 appears to be supportive among legislators concerned with tax equity, although there may be some apprehension regarding its impact on taxpayer compliance. Supporters are likely to argue that the bill addresses the challenges posed by remote sales and the need for fairness in tax collection. However, there may be concerns about how the implementation of this bill will be received by taxpayers, particularly regarding the added complexity it may introduce in tax filing processes.

Contention

Notable points of contention could arise from the administrative burden this bill might place on both taxpayers and the Louisiana Department of Revenue in developing the necessary infrastructure to support the new checkoff system. Critics may argue that it could complicate tax preparation for individuals and impose an undue burden on those who are less familiar with tax laws. Additionally, the sunset provision that terminates these regulations upon a federal law change could lead to uncertainties in tax policy depending on external regulatory changes.