HLS 23RS-1295 ORIGINAL
2023 Regular Session
HOUSE BILL NO. 642
BY REPRESENTATIVE JENKINS
TAX/SALES & USE: Provides relative to sales and use taxation of certain digital products
and services
1 AN ACT
2To amend and reenact R.S. 47:301(3)(a), (b), and (i)(ii)(aa)(I)(aaa), (4)(introductory
3 paragraph), (a) through (e), (h), and (i), (5), (7)(a), (g), and (i), (8)(b), (9), (10)(a)(i),
4 (ii), and (iii), (c)(ii)(bb), (j), (q)(i), (r), (s), (u), (ff), and (hh), (12), (13)(a), (14)(h),
5 (i), (j), and (k), (15), (18)(a), (d)(i), (e), and (f), (19), and (29)(x)(ix), 302(A), (B),
6 (D), (K)(1) and (2), (U), (V)(1)(introductory paragraph), (a), and (b)(introductory
7 paragraph) and (i), (BB)(13), (17), (25), (27), (30), (33), (56), (66), (81), (109), and
8 (113), and (CC), 303(A)(2) and (3)(a) and (G), 303.1(A) and (B)(1)(c) and (2)(b),
9 304(B), 305(E), 305.10(A), (C)(introductory paragraph), (1), (2)(a), (b), and (c), and
10 (3), (D), and (E), 305.14(A)(1)(a) and (5), 305.38, 305.53(A), 305.54(B) and (C)(1),
11 306.5(A)(1) and (2)(c), 307(A), (B), and (C), 309(A)(1), 309.1(B)(1) and (2)(a) and
12 (D), 310(A), 312, 314, 315(A) and (B)(1), 315.3(A), 315.5(A), (B)(3), and (C)(1)(c),
13 321(A), (B), (P)(9), (17), (23), (25), (27), (30), (56), (66), (81), (109), and (114), and
14 (Q), 321.1(A), (B), (I)(13), (17), (23), (25), (27), (30), (33), (56), (66), (81), (109),
15 and (114), and (J), 331(A), (B), (V)(13), (17), (23), (25), (27), (30), (33), (56), (66),
16 (81), (109), and (114), and (W), and 340.1(A)(3) and (5) and R.S. 51:1286(B), to
17 enact R.S. 47:301(10)(c)(ii)(cc), (jj), and (kk), (14)(l), (32), (33), and (34), and
18 301.3, and to repeal R.S. 47:301(16)(h) and (p) and 23, relative to sales and use
19 taxation of certain digital products and services; to provide for the levy of sales and
20 use taxes on certain digital products and services; to provide for the rates of the
Page 1 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 taxes; to provide relative to exclusions and exemptions from sales and use taxes; to
2 provide relative to administration of sales and use taxes; to provide relative to
3 collection and enforcement; to provide for liability for collection and payment of
4 certain sales and use taxes; to provide relative to record keeping and reporting; to
5 provide for definitions; to provide for effectiveness; and to provide for related
6 matters.
7Be it enacted by the Legislature of Louisiana:
8 Section 1. R.S. 47:301(3)(a), (b), and (i)(ii)(aa)(I)(aaa), (4)(introductory paragraph),
9(a) through (e), (h), (i), and (j), (5), (7)(a), (g), and (i), (8)(a) and (b), (9), (10)(a)(i), (ii), and
10(iii), (c)(ii)(bb), (j), (q)(i), (r), (s), (u), (ff), and (hh), (12), (13)(a), (14)(h), (i), (j), and (k),
11(18)(a), (d)(i), (e), and (f), (19), and (29)(x)(ix), 302(A), (B), (D), (K)(1) and (2), (U),
12(V)(1)(introductory paragraph), (a), and (b)(introductory paragraph) and (i), (BB)(13), (17),
13(25), (27), (30), (33), (56), (66), (81), (109), and (113), and (CC), 303(A)(2) and (3)(a) and
14(G), 303.1(A) and (B)(1)(c) and (2)(b), 304(B), 305(E), 305.10(A), (C)(introductory
15paragraph), (1), (2)(a), (b), and (c), and (3), (D), and (E), 305.14(A)(1)(a) and (5), 305.38,
16305.53(A), 305.54(B) and (C)(1), 306.5(A)(1) and (2)(c), 307(A), (B), and (C), 309(A)(1),
17309.1(B)(1) and (2)(a) and (D), 310(A), 312, 314, 315(A) and (B)(1), 315.3(A), 315.5(A),
18(B)(3), and (C)(1)(c), 321(A), (B), (P)(9), (17), (23), (25), (27), (30), (56), (66), (81), (109),
19and (114), and (Q), 321.1(A), (B), (I)(13), (17), (23), (25), (27), (30), (33), (56), (66), (81),
20(109), and (114), and (J), 331(A), (B), (V)(13), (17), (23), (25), (27), (30), (33), (56), (66),
21(81), (109), and (114), and (W), and 340.1(A)(3) and (5) and R.S. 51:1286(B) are hereby
22amended and reenacted and R.S. 47:301(10)(c)(ii)(cc), (jj), and (kk), (14)(l), (32), (33), and
23(34), and 301.3 are hereby enacted to read as follows:
24 ยง301. Definitions
25 As used in this Chapter, the following words, terms, and phrases have the
26 meanings ascribed to them in this Section, unless the context clearly indicates a
27 different meaning:
28 * * *
Page 2 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (3)(a) "Cost price" means the actual cost of the articles of tangible personal
2 property or digital products without any deductions therefrom on account of the cost
3 of materials used, labor, or service cost, except those service costs for installing the
4 articles of tangible personal property or digital products if such cost is separately
5 billed to the customer at the time of installation, transportation charges, or any other
6 expenses whatsoever, or the reasonable market value of the tangible personal
7 property or digital products at the time it becomes susceptible to the use tax,
8 whichever is less.
9 (b) In the case of tangible personal property or digital products which has
10 have acquired a tax situs in a taxing jurisdiction and is are thereafter transported
11 outside the taxing jurisdiction for repairs performed outside the taxing jurisdiction
12 and is thereafter returned to the taxing jurisdiction, the cost price shall be deemed to
13 be the actual cost of any parts and/or materials used in performing such repairs, if
14 applicable labor charges are separately stated on the invoice. If the applicable labor
15 charges are not separately stated on the invoice, it shall be presumed that the cost
16 price is the total charge reflected on the invoice.
17 * * *
18 (i)
19 * * *
20 (ii) For purposes of this Subparagraph, the following definitions shall apply:
21 (aa) "Machinery and equipment" means tangible personal property or other
22 property that is eligible for depreciation for federal income tax purposes and that is
23 used as an integral part in the manufacturing of tangible personal property for sale.
24 "Machinery and equipment" shall also mean tangible personal property or other
25 property that is eligible for depreciation for federal income tax purposes and that is
26 used as an integral part of the production, processing, and storing of food and fiber
27 or of timber.
28 (I) Machinery and equipment, for purposes of this Subparagraph, also
29 includes but is not limited to the following:
Page 3 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (aaa) Computers and software that are an integral part of the machinery and
2 equipment used directly in the manufacturing process control, communicate with or
3 control other computer systems that control, or control heating or cooling systems
4 for machinery or equipment that manufactures tangible personal property for sale.
5 Computers and software used for inventory and accounting systems or that control
6 non-qualifying machinery and equipment are not considered machinery and
7 equipment for purposes of this Subparagraph.
8 * * *
9 (4) "Dealer" includes every person who manufactures or produces tangible
10 personal property or digital products for sale at retail, for use, or consumption, or
11 distribution, or for storage to be used or consumed in a taxing jurisdiction. "Dealer"
12 is further defined to mean:
13 (a) Every person who imports, or causes to be imported, tangible personal
14 property or digital products from any other state, foreign country, or other taxing
15 jurisdiction for sale at retail, for use, or consumption, or distribution, or for storage
16 to be used or consumed in a taxing jurisdiction.
17 (b) Every person who sells at retail, or who offers for sale at retail, or who
18 has in his possession for sale at retail, or for use, or consumption, or distribution, or
19 storage to be used or consumed in the taxing jurisdiction, tangible personal property
20 or digital products as defined herein.
21 (c) Any person who has sold at retail, or used, or consumed, or distributed,
22 or stored for use or consumption in the taxing jurisdiction, tangible personal property
23 or digital products and who cannot prove that the tax levied by this Chapter has been
24 paid on the sale at retail, the use, the consumption, the distribution, or the storage of
25 said the tangible personal property or digital products.
26 (d)(i) Any person who leases or rents tangible personal property or digital
27 products for a consideration, permitting the use or possession of the said property
28 without transferring title thereto.
Page 4 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (ii) However, a person who leases or rents tangible personal property or
2 digital products to customers who provide information to such person that they will
3 use the property only offshore beyond the territorial limits of the state shall not be
4 included in the term "dealer" for purposes of the collection of the rental or lease tax
5 of the state, statewide political subdivisions, and other political subdivisions on such
6 lease or rental contracts. For purposes of this Item, "use" means the operational or
7 functional use of the property and not other uses related to its possession such as
8 transportation, maintenance, and repair. It is the intention of this Item that the
9 customers of such persons shall remit any tax due on the lease or rental of such
10 property directly to the state and local taxing bodies to whom they are due.
11 (e) Any person who is the lessee or rentee of tangible personal property or
12 digital products and who pays to the owner of such property or product a
13 consideration for the use or possession of such property without acquiring title
14 thereto.
15 * * *
16 (h) Any person engaging in business in the taxing jurisdiction. "Engaging in
17 business in the taxing jurisdiction" means and includes any of the following methods
18 of transacting business: maintaining directly, indirectly, or through a subsidiary, an
19 office, distribution house, sales house, warehouse, or other place of business or by
20 having an agent, salesman, or solicitor operating within the taxing jurisdiction under
21 the authority of the seller or its subsidiary irrespective of whether such place of
22 business, agent, salesman, or solicitor is located in such taxing jurisdiction
23 permanently or temporarily or whether such seller or subsidiary is qualified to do
24 business in such taxing jurisdiction, or any person who makes deliveries of tangible
25 personal property or digital products into the taxing jurisdiction other than by a
26 common or contract carrier.
27 (i) Any person who sells at retail any tangible personal property or digital
28 products to a vending machine operator for resale through coin-operated vending
29 machines.
Page 5 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 * * *
2 (5) "Gross sales" means the sum total of all retail sales of tangible personal
3 property or digital products, without any deduction whatsoever of any kind or
4 character except as provided in this Chapter.
5 * * *
6 (7)(a) "Lease or rental" means the leasing or renting of tangible personal
7 property or digital products and the possession or use thereof by the lessee or renter,
8 for a consideration, without transfer of the title of such property. For the purpose of
9 the leasing or renting of automobiles, "lease" means the leasing of automobiles and
10 the possession or use thereof by the lessee, for a consideration, without the transfer
11 of the title of such property for a one hundred eighty-day period or more. "Rental"
12 means the renting of automobiles and the possession or use thereof by the renter, for
13 a consideration, without the transfer of the title of such property for a period less
14 than one hundred eighty days.
15 * * *
16 (g) For purposes of state and political subdivision sales and use tax, "lease
17 or rental" shall not mean the lease or rental of tangible personal property or digital
18 products to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc. which is
19 used by such organizations for their educational and public service programs for
20 youth.
21 * * *
22 (i) For purposes of sales and use taxes levied and imposed by local
23 governmental subdivisions, school boards, and other political subdivisions whose
24 boundaries are not coterminous with those of the state, "lease or rental" by a person
25 shall not mean or include the lease or rental of tangible personal property or digital
26 products if such lease or rental is made under the provisions of Medicare.
27 * * *
28 (8)
29 * * *
Page 6 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (b) Solely for purposes of the payment of state sales or use tax on the lease
2 or rental or the purchase of tangible personal property, digital products, or services,
3 "person" shall not include a regionally accredited independent institution of higher
4 education which is a member of the Louisiana Association of Independent Colleges
5 and Universities, if such lease or rental or purchase is directly related to the
6 educational mission of such institution. However, the term "person" shall include
7 such institution for purposes of the payment of tax on sales by such institution if the
8 sales are not otherwise exempt.
9 * * *
10 (9) "Purchaser" means and includes any person who acquires or receives any
11 tangible personal property or digital products, or the privilege of using any tangible
12 personal property or digital products, or receives any services pursuant to a
13 transaction subject to tax under this Chapter.
14 (10)(a)(i) Solely for the purposes of the imposition of the state sales and use
15 tax, "retail sale" or "sale at retail" means a sale to a consumer or to any other person
16 for any purpose other than for resale as tangible personal property or digital product,
17 or for the lease of automobiles in an arm's length transaction, and shall mean and
18 include all such transactions as the secretary, upon investigation, finds to be in lieu
19 of sales; provided that sales for resale or for lease of automobiles in an arm's length
20 transaction must be made in strict compliance with the rules and regulations. Any
21 dealer making a sale for resale or for the lease of automobiles, which is not in strict
22 compliance with the rules and regulations, shall himself be liable for and pay the tax.
23 (ii) Solely for purposes of the imposition of the sales and use tax levied by
24 a political subdivision or school board, "retail sale" or "sale at retail" shall mean a
25 sale to a consumer or to any other person for any purpose other than for resale in the
26 form of tangible personal property or digital product, or resale of those services
27 defined in Paragraph (14) of this Section provided the retail sale of the service is
28 subject to sales tax in this state, and shall mean and include all such transactions as
29 the collector, upon investigation, finds to be in lieu of sales; provided that sales for
Page 7 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 resale be made in strict compliance with the rules and regulations. Any dealer
2 making a sale for resale, which is not in strict compliance with the rules and
3 regulations shall himself be liable for and pay the tax. A local collector shall accept
4 a resale certificate issued by the Department of Revenue, provided the taxpayer
5 includes the parish of its principal place of business and local sales tax account
6 number on the state certificate. However, in the case of an intra-parish transaction
7 from dealer to dealer, the collector may require that the local exemption certificate
8 be used in lieu of the state certificate. The department shall accommodate the
9 inclusion of such information on its resale certificate for such purposes.
10 (iii) "Retail sale" or "sale at retail" for purposes of sales and use taxes
11 imposed by the state on transactions involving the sale for rental of automobiles
12 which take place on or after January 1, 1991, and by political subdivisions on such
13 transactions on or after July 1, 1996, and state sales and use taxes imposed on
14 transactions involving the lease or rental of tangible personal property or digital
15 products other than automobiles which take place on or after July 1, 1991, means a
16 sale to a consumer or to any other person for any purpose other than for resale as
17 tangible personal property or digital product, or for lease or rental in an arm's length
18 transaction in the form of tangible personal property or digital product, and shall
19 mean and include all such transactions as the secretary, upon investigation, finds to
20 be in lieu of sales; provided that sales for resale or for lease or rental in an arm's
21 length transaction must be made in strict compliance with the rules and regulations.
22 Any dealer making a sale for resale or for lease or rental, which is not in strict
23 compliance with the rules and regulations, shall himself be liable for and pay the tax.
24 For purposes of the imposition of the tax imposed by any political subdivision of the
25 state, for the period beginning on July 1, 1999, and ending on June 30, 2000, the
26 term "retail sale" or "sale at retail" shall not include one-fourth of the sales price of
27 any tangible personal property which is sold in order to be leased or rented in an
28 arm's length transaction in the form of tangible personal property. For purposes of
29 the imposition of the tax imposed by any political subdivision of the state, for the
Page 8 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 period beginning on July 1, 2000, and ending on June 30, 2001, the term "retail sale"
2 or "sale at retail" shall not include one-half of the sales price of any tangible personal
3 property which is sold in order to be leased or rented in an arm's length transaction
4 in the form of tangible personal property. For purposes of the imposition of the tax
5 imposed by any political subdivision of the state, for the period beginning on July
6 1, 2001, and ending on June 30, 2002, the term "retail sale" or "sale at retail" shall
7 not include three-fourths of the sales price of any tangible personal property which
8 is sold in order to be leased or rented in an arm's length transaction in the form of
9 tangible personal property. Beginning July 1, 2002, for the purposes of imposition
10 of the tax levied by any political subdivision of the state, the term "retail sale" or
11 "sale at retail" shall not include the sale of any tangible personal property which is
12 sold in order to be leased or rented in an arm's length transaction in the form of
13 tangible personal property.
14 * * *
15 (c)
16 * * *
17 (ii)
18 * * *
19 (bb) The term "sale at retail" does not include an isolated or occasional sale
20 of tangible personal property or digital products by a person not engaged in such
21 business.
22 (cc) Solely for purposes of the sales and use tax levied by the state, the term
23 "sale at retail" does not include consuming any digital product in producing for sale
24 a new product, where the digital product becomes an ingredient or component of the
25 new product. A digital code becomes an ingredient or component of a new product
26 if the digital product through the use of the digital code becomes an ingredient or
27 component of the new product.
28 * * *
Page 9 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (j) The term "sale at retail" does not include the sale of tangible personal
2 property or digital products to food banks, as defined in R.S. 9:2799.
3 * * *
4 (q) For purposes of state and political subdivision sales and use tax, the term
5 "sale at retail" shall not include:
6 (i) The sale of tangible personal property or digital products by approved
7 parochial and private elementary and secondary schools which comply with the court
8 order from the Dodd Brumfield decision and Section 501(c)(3) of the Internal
9 Revenue Code, or students, administrators, or teachers, or other employees of the
10 school, if the money from such sales, less reasonable and necessary expenses
11 associated with the sale, is used solely and exclusively to support the school or its
12 program or curricula. This exclusion shall not be construed to allow tax-free sales
13 to students or their families by promoters or regular commercial dealers through the
14 use of schools, school faculty, or school facilities.
15 * * *
16 (r) For purposes of state and political subdivision sales and use tax, the term
17 "sale at retail" shall not include the sale of tangible personal property or digital
18 products to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc. which is
19 used by such organizations for their educational and public service programs for
20 youth.
21 (s) The term "sale at retail" or "retail sale", for purposes of sales and use
22 taxes imposed by the state or any political subdivision or other taxing entity, shall
23 not include any charge, fee, money, or other consideration received, given, or paid
24 for the performance of funeral directing services. For purposes of this Subparagraph,
25 "funeral directing services" means the operation of a funeral home, or by way of
26 illustration and not limitation, any service whatsoever connected with the
27 management of funerals, or the supervision of hearses or funeral cars, the cleaning
28 or dressing of dead human bodies for burial, and the performance or supervision of
29 any service or act connected with the management of funerals from time of death
Page 10 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 until the body or bodies are delivered to the cemetery, crematorium, or other agent
2 for the purpose of disposition. However, such services shall not mean or include the
3 sale, lease, rental, or use of any tangible personal property or digital product as those
4 terms are defined in this Section.
5 * * *
6 (u) For purposes of sales and use taxes levied and imposed by local
7 governmental subdivisions, school boards, and other political subdivisions whose
8 boundaries are not coterminous with those of the state, "sale at retail" by a person
9 shall not mean or include the sale of tangible personal property or digital products
10 if such sale is made under the provisions of Medicare.
11 * * *
12 (ff) For purposes of sales taxes imposed by the state or any political
13 subdivision of the state, the term "retail sale" or "sale at retail" shall not include sales
14 of tangible personal property or digital products by the Military Department, state
15 of Louisiana, which occur on an installation or other property owned or operated by
16 the Military Department.
17 * * *
18 (hh) For purposes of sales and use tax imposed by the state under R.S.
19 47:302, 321, and 331, or any other political subdivision, the term "sale at retail" shall
20 not include the sale of tangible personal property or digital products at an event
21 providing Louisiana heritage, culture, crafts, art, food, and music which is sponsored
22 by a domestic nonprofit organization that is exempt from tax under Section 501(c)(3)
23 of the Internal Revenue Code. The provisions of this Subparagraph shall apply only
24 to an event which transpires over a minimum of seven but not more than twelve days
25 and has a five-year annual average attendance of at least three hundred thousand over
26 the duration of the event. For purposes of determining the five-year annual average
27 attendance, the calculation shall include the total annual attendance for each of the
28 five most recent years. The provisions of this Subparagraph shall apply only to sales
29 by the sponsor of the event.
Page 11 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 * * *
2 (jj) Solely for purposes of the sales and use tax levied by the state, with
3 respect to digital products, the term "sale at retail" does not include making any
4 digital product available free of charge for the use or enjoyment of others. For
5 purposes of this Subparagraph, "free of charge" means that the recipient of the digital
6 product does not need to provide anything of significant value. A transfer is not free
7 of charge if the digital product is bundled or combined with other products or
8 services subject to sales or use tax regardless of whether such items are separately
9 stated and invoiced.
10 (kk) Solely for purposes of the sales and use tax levied by the State, with
11 respect to digital products, the term "sale at retail" does not include the sale of audio
12 or video programing by a radio or television broadcaster. The term "sale at retail"
13 does include programming, sold by a radio or television broadcaster, that is sold on
14 a pay per program basis or that allows the buyer to access a library of programs at
15 any time for a specific charge for that service. For purposes of this Subparagraph,
16 "radio or television broadcaster" includes, but is not limited to, satellite radio
17 providers, satellite television providers, cable television providers and providers of
18 subscription internet television. In the event a radio or television broadcaster
19 provides a nontaxable good or service along with a taxable good or service, the entire
20 purchase is subject to state sales and use tax, regardless of whether or not such items
21 are separately stated and invoiced.
22 * * *
23 (12)(a) "Sale" means any transfer of title or possession, or both, exchange,
24 barter, conditional or otherwise, in any manner or by any means whatsoever, of
25 tangible personal property or digital products, for a consideration, and includes the
26 fabrication of tangible personal property for consumers who furnish, either directly
27 or indirectly, the materials used in fabrication work, and the furnishing, preparing or
28 serving, for a consideration, of any tangible personal property, consumed on the
29 premises of the person furnishing, preparing or serving such tangible personal
Page 12 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 property. A transaction whereby the possession of property is transferred but the
2 seller retains title as security for the payment of the price shall be deemed a sale.
3 (b) With respect to digital products, "sale" means the first act within this
4 state by which the taxpayer, as a consumer, views, accesses, downloads, possesses,
5 stores, opens, manipulates, or otherwise uses or enjoys the product.
6 (c) With respect to a digital automated service, "sale" means the first act
7 within this state by which the taxpayer, as a consumer, uses, enjoys, or otherwise
8 receives the benefit of the service.
9 (13)(a) "Sales price" means the total amount for which tangible personal
10 property is or digital products are sold, less the market value of any article traded in
11 including any services, except services for financing, that are a part of the sale valued
12 in money, whether paid in money or otherwise, and includes the cost of materials
13 used, labor or service costs, except costs for financing which shall not exceed the
14 legal interest rate and a service charge not to exceed six percent of the amount
15 financed, and losses; provided that cash discounts allowed and taken on sales shall
16 not be included, nor shall the sales price include the amount charged for labor or
17 services rendered in installing, applying, remodeling, or repairing property sold.
18 * * *
19 (14) "Sales of services" means and includes the following:
20 * * *
21 (h)(i) The furnishing of a digital automated service. For purposes of this
22 Subparagraph, "digital automated service" means any service transferred
23 electronically that uses one or more software applications either prewritten or
24 custom, as well as components that are similar to stand-alone digital products.
25 (ii) "Digital automated service" does not include any of the following:
26 (aa) Any service that primarily involves the application of human effort, and
27 the human effort originated after the customer requested the service.
28 (bb) The loaning or transferring of money or the purchase, sale, or transfer
29 of financial instruments. For purposes of this Subparagraph, "financial instruments"
Page 13 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 includes cash, accounts receivable and payable, loans and notes receivable and
2 payable, debt securities, equity securities, as well as derivative contracts such as
3 forward contracts, swap contracts, and options.
4 (cc) Dispensing cash or other physical items from a machine.
5 (dd) Payment processing services.
6 (ee) Pari-mutuel wagering or fantasy sports betting.
7 (ff) Telecommunications services and ancillary services as those terms are
8 defined in Subparagraphs (29)(b) and (x) of this Section.
9 (gg) Internet access service charges.
10 (hh) Online educational programs provided by any of the following:
11 (I) A public or private elementary or secondary school.
12 (II) An institution of higher education as defined in sections 1001 or 1002
13 of the federal higher education act of 1965 (20 U.S.C. 1001 and 1002), as existing
14 on July 1, 2009, if the online educational program is encompassed within the
15 institution's accreditation.
16 (ii) Travel agent services, including online travel services, and automated
17 systems used by travel agents to book reservations.
18 (jj) Live presentations, such as lectures, seminars, workshops, or courses,
19 where participants are connected to other participants via the internet or
20 telecommunications equipment, which allows audience members and the presenter
21 or instructor to give, receive, and discuss information with each other in real time.
22 (kk) A service that allows the person receiving the service to make online
23 sales of products or services, digital or otherwise, using the service provider's
24 website. The service described in this Subitem does not include the underlying sale
25 of the products or services, digital or otherwise, by the person receiving the service.
26 (ll) Advertising services. For purposes of this Subparagraph, "advertising
27 services" means all services directly related to the creation, preparation, production,
28 or the dissemination of advertisements. "Advertising services" includes layout, art
29 direction, graphic design, mechanical preparation, production supervision,
Page 14 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 placement, and rendering advice to a client concerning the best methods of
2 advertising that client's products or services. "Advertising services" also includes
3 online referrals, search engine marketing and lead generation optimization, web
4 campaign planning, the acquisition of advertising space in the internet media, and
5 the monitoring and evaluation of website traffic for purposes of determining the
6 effectiveness of an advertising campaign. "Advertising services" does not include
7 web hosting services and domain name registration.
8 (i) The term "sale of service" shall not include an action performed pursuant
9 to a contract with the United States Department of the Navy for construction or
10 overhaul of U.S. Naval vessels.
11 (i) (j) Solely for purposes of the sales and use tax levied by the state, the
12 furnishing of telecommunications services for compensation, in accordance with the
13 provisions of R.S. 47:301.1. Local political subdivisions are prohibited from levying
14 a sales and use tax on telecommunications services not in effect on July 1, 1990,
15 provided, however, that the provisions of this Subparagraph shall not be construed
16 to prohibit the levy or collection of any franchise, excise, gross receipts, or similar
17 tax or assessment by any political subdivision of the state as defined in Article VI,
18 Section 44(2) of the Constitution of Louisiana.
19 (j) (k) Notwithstanding any provision of law to the contrary, for purposes of
20 sales or use taxation by the state or any local political subdivision, the term "sales of
21 services" shall not mean or include any funeral directing services as defined in
22 Subparagraph (10)(s) of this Section. Subject to approval by the House Committee
23 on Ways and Means and the Senate Committee on Revenue and Fiscal Affairs, the
24 state Department of Revenue shall devise a formula for the calculation of the tax.
25 (k) (l) Solely for purposes of sales and use tax imposed by the state under
26 R.S. 47:302, 321, and 331, any political subdivision whose boundaries are
27 coterminous with those of the state, or any other political subdivision, the term "sales
28 of services" shall not mean or include admission charges for, outside gate admissions
29 to, or parking fees associated with an event providing Louisiana heritage, culture,
Page 15 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 crafts, art, food, and music which is sponsored by a domestic nonprofit organization
2 that is exempt from tax under Section 501(c)(3) of the Internal Revenue Code. The
3 provisions of this Subparagraph shall apply only to an event which transpires over
4 a minimum of seven but not more than twelve days and has a five-year annual
5 average attendance of at least three hundred thousand over the duration of the event.
6 For purposes of determining the five-year annual average attendance, the calculation
7 shall include the total annual attendance for each of the five most recent years. The
8 provisions of this Subparagraph shall apply only to admission charges for, outside
9 gate admissions to, or parking fees associated with an event when the charges and
10 fees are payable to or for the benefit of the sponsor of the event.
11 (15) "Storage" means and includes any keeping or retention in the taxing
12 jurisdiction of tangible personal property or digital products for use or consumption
13 within the taxing jurisdiction or for any purpose other than for sale at retail in the
14 regular course of business.
15 * * *
16 (18)(a)(i) Solely for purposes of the imposition of the state sales and use tax,
17 "use" means and includes the exercise of any right or power over tangible personal
18 property or digital products incident to the ownership thereof, except that it shall not
19 include the sale at retail of that property in the regular course of business or the
20 donation to a school in the state which meets the definition provided in R.S. 17:236
21 or to a public or recognized independent institution of higher education in the state
22 of property previously purchased for resale in the regular course of a business. The
23 term "use" shall not include the purchase, the importation, the consumption, the
24 distribution, or the storage of automobiles to be leased in an arm's length transaction,
25 nor shall the term "use" include the donation of food items to a food bank as defined
26 in R.S. 9:2799(B).
27 (ii) For purposes of the imposition of the sales and use tax levied by a
28 political subdivision or school board, "use" shall mean and include the exercise of
29 any right or power over tangible personal property or digital products incident to the
Page 16 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 ownership thereof, except that it shall not include the sale at retail of that property
2 in the regular course of business or the donation to a school in the state which meets
3 the definition provided in R.S. 17:236 or to a public or recognized independent
4 institution of higher education in the state of property previously purchased for resale
5 in the regular course of a business. The term "use" shall not include the donation of
6 food items to a food bank as defined in R.S. 9:2799(B).
7 (iii) The term "use", for purposes of sales and use taxes imposed by the state
8 on the use for rental of automobiles which take place on or after January 1, 1991, and
9 by political subdivisions on such use on or after July 1, 1996, and state sales and use
10 taxes imposed on the use for lease or rental of tangible personal property or digital
11 products other than automobiles which take place on or after July 1, 1991, shall not
12 include the purchase, the importation, the consumption, the distribution, or the
13 storage of tangible personal property or digital products to be leased or rented in an
14 arm's length transaction as tangible personal property or digital products. For
15 purposes of the imposition of the tax levied by any political subdivision of the state,
16 for the period beginning July 1, 1999, and ending on June 30, 2000, the term "use"
17 shall not include one-fourth of the cost price of any tangible personal property which
18 is purchased, imported, consumed, distributed, or stored and which is to be leased
19 or rented in an arm's length transaction in the form of tangible personal property.
20 For purposes of the imposition of the tax levied by any political subdivision of the
21 state, for the period beginning July 1, 2000, and ending on June 30, 2001, the term
22 "use" shall not include one-half of the cost price of any tangible personal property
23 which is purchased, imported, consumed, distributed, or stored and which is to be
24 leased or rented in an arm's length transaction in the form of tangible personal
25 property. For purposes of the imposition of the tax levied by any political
26 subdivision of the state, for the period beginning July 1, 2001, and ending on June
27 30, 2002, the term "use" shall not include three-fourths of the cost price of any
28 tangible personal property which is purchased, imported, consumed, distributed, or
29 stored and which is to be leased or rented in an arm's length transaction in the form
Page 17 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 of tangible personal property. Beginning July 1, 2002, for purposes of the imposition
2 of the tax levied by any political subdivision of the state, the term "use" shall not
3 include the purchase, the importation, the consumption, the distribution, or the
4 storage of any tangible personal property which is to be leased or rented in an arm's
5 length transaction in the form of tangible personal property.
6 (iv) The term "use", for purposes of sales and use taxes imposed by the state
7 on the use for rental automobiles which take place prior to January 1, 1991, and by
8 political subdivisions on such use prior to July 1, 1996, and imposed on the use for
9 lease or rental of tangible personal property other than automobiles which take place
10 prior to July 1, 1991, and for purposes of local sales and use taxes levied by political
11 subdivisions, except for any use for rental automobiles on or after July 1, 1996, shall
12 include the purchase, the importation, the consumption, the distribution, or the
13 storage of tangible personal property or digital products to be leased or rented in an
14 arm's length transaction as tangible personal property or digital products.
15 (v) The term "use" for purposes of sales and use tax imposed by the state on
16 digital products, including digital automated services, applies to the first act within
17 this state by which the taxpayer, as a consumer, views, accesses, downloads,
18 possesses, stores, opens, manipulates or otherwise enjoys, uses or receives the
19 benefits of the digital product or digital automated services. "Use" includes access
20 and use of digital products that remain in the possession of the dealer or in the
21 possession of a third party on behalf of the dealer
22 * * *
23 (d)(i) Notwithstanding any other provision of law to the contrary, and except
24 as provided in Item (iii) of this Subparagraph, for purposes of state and political
25 subdivision sales and use tax, "use" means and includes the exercise of any right or
26 power over tangible personal property or digital products incident to the ownership
27 thereof, except that it shall not include the further processing of tangible personal
28 property or digital products into articles of tangible personal property for sale.
29 * * *
Page 18 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (e) For purposes of state and political subdivision sales and use tax, "use"
2 shall not include the purchase of or the exercise of any right or power over:
3 (i) Tangible personal property or digital products sold by approved parochial
4 and private elementary and secondary schools which comply with the court order
5 from the Dodd Brumfield decision and Section 501(c)(3) of the Internal Revenue
6 Code, or students, administrators, or teachers, or other employees of the school, if
7 the money from such sales, less reasonable and necessary expenses associated with
8 the sale, is used solely and exclusively to support the school or its program or
9 curricula.
10 (ii) Educational materials or equipment used for classroom instruction by
11 approved parochial and private elementary and secondary schools which comply
12 with the court order from the Dodd Brumfield decision and Section 501(c)(3) of the
13 Internal Revenue Code, limited to books, workbooks, computers, computer software,
14 films, videos, and audio tapes, including when these items are transferred
15 electronically.
16 (f) For purposes of state and political subdivision sales and use tax, "use"
17 shall not include the purchase of or the exercise of any right or power over tangible
18 personal property or digital products used by Boys State of Louisiana, Inc. and Girls
19 State of Louisiana, Inc. for their educational and public service programs for youth.
20 * * *
21 (19) "Use tax" includes the use, the consumption, the distribution, and the
22 storage as herein defined. No use tax shall be due to or collected by:
23 (a) The state on tangible personal property or digital products used,
24 consumed, distributed, or stored for use or consumption in the state if the sale of
25 such property would have been exempted or excluded from sales tax at the time such
26 property became subject to the taxing jurisdiction of the state.
27 (b) Any political subdivision on tangible personal property or digital
28 products used, consumed, distributed, or stored for use or consumption in such
29 political subdivision if the sale of such property would have been exempted or
Page 19 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 excluded from sales tax at the time such property became subject to the taxing
2 jurisdiction of the political subdivision.
3 * * *
4 (29) With respect to the furnishing of telecommunications and ancillary
5 services, as used in this Chapter the following words, terms, and phrases have the
6 meaning ascribed to them in this Paragraph, unless the context clearly indicates a
7 different meaning:
8 * * *
9 (x) "Telecommunications service" means the electronic transmission,
10 conveyance, or routing of voice, data, audio, video, or any other information or
11 signals to a point, or between or among points. "Telecommunications service"
12 includes such transmission, conveyance, or routing in which computer processing
13 applications are used to act on the form, code, or protocol of the content for purposes
14 of transmission, conveyance, or routing without regard to whether such service is
15 referred to as voice over Internet protocol service or is classified by the Federal
16 Communications Commission as an enhanced or value-added service.
17 "Telecommunications service" does not include any of the following:
18 * * *
19 (ix) Digital products delivered electronically, including but not limited to
20 software, music, video, reading materials, or ring tones.
21 * * *
22 (32) "Digital code" means a code that permits a purchaser to obtain at a later
23 date one or more digital products, if all of the digital products to be obtained through
24 the use of the code have the same sales and use tax treatment. "Digital code" does
25 not include a code that represents a stored monetary value that is deducted from a
26 total as it is used by the purchaser. "Digital code" also does not include a code that
27 represents a redeemable card, gift card, or gift certificate that entitles the holder to
28 select digital products of an indicated cash value. A digital code may be obtained by
Page 20 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 any means, including e-mail or by tangible means regardless of its designation as
2 song code, video code, book code, or some other term.
3 (33)(a) "Digital product" means a product that is transferred electronically or
4 delivered by means other than tangible storage media through the use of technology
5 having electrical, digital, magnetic, wireless, optical or electromagnetic, or similar
6 capabilities.
7 (b) "Digital product" includes, but is not limited to, all of the following:
8 (i) Sounds, images, data, facts, or information, or any combination thereof.
9 (ii) Computer software as defined in Paragraph (22) of this Section.
10 (iii) Charges made to customers for the right to access and use prewritten
11 computer software, where possession of the software is maintained by the seller or
12 a third party regardless of whether the charge for the service is on a per use, per user,
13 per license, subscription or some other basis.
14 (iv) Digital codes.
15 (c) "Digital product" does not include any of the following:
16 (i) Any intangible such as a patent, stock, bond, goodwill, trademark,
17 franchise, or copyright.
18 (ii) Telecommunications services and ancillary services as those terms are
19 defined in Subparagraphs (29)(b) and (x) of this Section.
20 (iii) Internet access service charges.
21 (iv) The representation of a professional service, as described in R.S.
22 Subparagraph (16)(e) of this Section, in an electronic form, such as an electronic
23 copy of an engineering report prepared by an engineer that primarily involves the
24 application of human effort, and the human effort originated after the customer
25 requested the service.
26 (v) Subscription sales of magazines or periodicals transferred electronically
27 to the buyer.
28 (vi) Newspapers transferred electronically if the exclusion in Subparagraph
29 (16)(p) of this Section is in effect.
Page 21 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (d) For purposes of this Section, the term "permanent use" means use that
2 is perpetual or for an indefinite or unspecified length of time.
3 (e)(i) For the purposes of this Section, "end user" means any purchaser other
4 than a purchaser who receives by contract a digital product for further commercial
5 broadcast, rebroadcast, transmission, retransmission, licensing, relicensing,
6 distribution, redistribution or exhibition of the product, in whole or in part, to others.
7 A person that purchases digital products for the purpose of giving away such
8 products or codes will not be considered to have engaged in the distribution or
9 redistribution of such products or codes and will be treated as an end user.
10 (ii) If a purchaser of a digital product does not receive the contractual right
11 to further redistribute, after the digital code is redeemed, the underlying product to
12 which the digital code relates, then the purchaser of the digital code is an end user.
13 If the purchaser of the digital code receives the contractual right to further
14 redistribute, after the digital code is redeemed, the underlying product to which the
15 digital code relates, then the purchaser of the digital code is not an end user. A
16 purchaser of a digital code who has the contractual right to further redistribute the
17 digital code is an end user if that purchaser does not have the right to further
18 redistribute, after the digital code is redeemed, the underlying product to which the
19 digital code relates.
20 (f) The sale of a digital code that may be utilized to obtain a digital product
21 shall be taxed in the same manner as the digital product.
22 (g) For purposes of taxes imposed under this Chapter or Chapter 2-A or 2-C
23 of this Title, whenever the words "property" or "personal property" are used, those
24 terms shall be construed to include any digital product unless any of the following
25 applies:
26 (i) It is clear from the context that the term "personal property" is intended
27 to refer only to tangible personal property.
28 (ii) It is clear from the context that the term "property" is intended to refer
29 only to tangible personal property, real property, or both.
Page 22 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (iii) To construe the term "property" or "personal property" as including any
2 digital product would yield unlikely, absurd, or strained consequences.
3 (34) "Transferred electronically" means any product obtained by the
4 purchaser by means other than tangible storage media, regardless of whether the
5 seller grants permanent or less than permanent use and regardless of whether the
6 transaction is conditioned upon contingent payment. It is not necessary that a copy
7 of the product be physically transferred to the purchaser. So long as the purchaser
8 may access the product, it will be considered to have been electronically transferred
9 to the purchaser. The definition applies whether the transfer is to an end user or a
10 person who is not an end user, unless otherwise exempted.
11 * * *
12 ยง301.3. Digital Products
13 A. Nexus. For purposes of the taxes imposed in this Title, the department
14 may not consider a person's ownership of, or rights in digital products residing on
15 servers located in this state in determining whether the person has substantial nexus
16 with this state. For purposes of this Section, "substantial nexus" means the requisite
17 connection that a person has with a state to allow the state to subject the person to
18 the state's taxing authority, consistent with the commerce clause of the United States
19 Constitution.
20 B. Amnesty. Purchasers of digital products shall have the following
21 amnesty:
22 (1) Except as provided in Paragraph (2) of this Subsection, no person may
23 be held liable for the failure to collect or pay state sales and use taxes accrued before
24 July 1, 2023 on the sale or use of digital products.
25 (2) The provisions of Paragraph (1) of this Subsection do not relieve any
26 person from liability for state sales taxes that the person collected from buyers but
27 did not remit to the department.
Page 23 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (3) Nothing in this Subsection shall be construed as authorizing the refund
2 of state sales and use taxes properly paid on the sale or use of digital products before
3 July 1, 2023.
4 C. Multiple Points of Use. (1) State sales and use tax impositions do not
5 apply to the sale of digital products, or services defined as a retail sale or sale at
6 retail in R.S. 47:301(10), to a buyer that provides the seller with an exemption
7 certificate claiming multiple points of use. An exemption certificate claiming
8 multiple points of use must be in a form and contain such information as required by
9 the department.
10 (2) A buyer is entitled to use an exemption certificate claiming multiple
11 points of use only if the buyer is a business or other organization and the purchased
12 digital products or services will be concurrently available for use within and outside
13 this state. A buyer is not entitled to use an exemption certificate claiming multiple
14 points of use for digital products or services that are purchased for personal use.
15 (3) A buyer claiming an exemption pursuant to this Subsection shall report
16 and pay all state sales and use tax due directly to the department in accordance with
17 R.S. 47:306(A).
18 (4) For purposes of this Subsection, "concurrently available for use within
19 and outside this state" means that employees or other agents of the buyer may use the
20 digital products or services, defined as a retail sale or sale at retail in R.S.
21 47:301(10), simultaneously from one or more locations within this state and one or
22 more locations outside this state. A digital code is concurrently available for use
23 within and outside this state if employees or other agents of the buyer may use the
24 digital goods or services to be obtained by the code simultaneously at one or more
25 locations within this state and one or more locations outside this state.
26 (5) A business or other organization subject to use tax on digital products or
27 services that are concurrently available for use within and outside this state is entitled
28 to allocate the amount of tax due this state based on users in this state compared to
29 users everywhere. Additionally, the department may authorize or require an
Page 24 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 alternative method of allocation supported by the taxpayer's records that fairly
2 reflects the proportion of in-state to out-of-state use by the taxpayer. No allocation
3 is allowed pursuant to this Subsection unless the allocation method is supported by
4 the taxpayer's records kept in the ordinary course of business.
5 D. Bundled Transactions. (1) In the case of the sale of a digital code that
6 provides a purchaser with the right to obtain more than one digital product, and
7 which may also include the right to obtain other products or services, and all of the
8 products and services, digital or otherwise, to be obtained through the use of the code
9 do not have the same sales and use tax treatment, both of the following shall apply:
10 (a) The transaction is deemed to be the sale of the products and services to
11 be obtained through the use of the code.
12 (b) The state sales and use tax applies to the entire selling price of the code,
13 except as provided in Paragraph (2) of this Subsection.
14 (2) If the seller can identify by reasonable and verifiable standards the portion
15 of the selling price attributable to the products and services that are not subject to
16 state sales and use tax from its books and records that are kept in the regular course
17 of business for other purposes including, but not limited to nontax purposes, state
18 sales and use tax does not apply to that portion of the selling price of the code
19 attributable to the products and services that are not subject to state sales and use tax.
20 E. Sourcing for sales tax purposes. (1) Sales or leases of digital products or
21 services are deemed to take place at the first of the following locations that applies
22 to the transaction:
23 (a) The business location, in cases where the digital product or service is
24 received by the buyer at a business location.
25 (b) If Subparagraph (a) of this Paragraph is not applicable, the location
26 where receipt of the digital product or service takes place.
27 (c) If Subparagraph (a) or (b) of this Paragraph is not applicable, the location
28 indicated by an address for the buyer that is available from the seller's business
Page 25 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 records maintained in the ordinary course of business, so long as the address does not
2 constitute bad faith.
3 (d) If Subparagraph (a), (b) or (c) of this Paragraph is not applicable, the
4 location indicated by an address for the buyer obtained during the sale.
5 (e) If Subparagraph (a), (b), (c), or (d) of this Paragraph is not applicable or
6 the seller is without sufficient information to apply those provisions, the location
7 determined by the address from which the digital product or service was first
8 available for transmission by the seller, or from which the digital service was
9 provided.
10 (2) For purposes of Paragraph (1) of this Subsection, "receive" or "receipt"
11 means:
12 (a) Making first use of a digital service; or
13 (b) Taking possession or making first use of a digital product, whichever
14 occurs first.
15 F. Sourcing for use tax purposes. (1) Use of digital products means the
16 location of the first act within this state by which the taxpayer, as a consumer, views,
17 accesses, downloads, possesses, stores, opens, manipulates, or otherwise uses or
18 enjoys a digital product.
19 (2) Use of a digital service means the location of the first act within this state
20 by which the taxpayer, as a consumer, uses, enjoys, or otherwise receives the benefit
21 of the service.
22 G. Rules. The secretary may promulgate rules and regulations in accordance
23 with the Administrative Procedure Act to implement the provisions of this Section,
24 including rules addressing the taxation of any and all digital products and services.
25 Any rule promulgated by the department shall be construed in favor of the secretary.
26 ยง302. Imposition of tax
27 A. There is hereby levied a tax upon the sale at retail, the use, the
28 consumption, the distribution, and the storage for use or consumption in this state,
Page 26 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 of each item or article of tangible personal property or digital product, as defined
2 herein, the levy of said tax to be as follows:
3 (1) At the rate of two per centum (2%) of the sales price of each item or
4 article of tangible personal property or digital product when sold at retail in this
5 state; the tax to be computed on gross sales for the purpose of remitting the amount
6 of tax due the state, and to include each and every retail sale.
7 (2) At the rate of two per centum (2%) of the cost price of each item or
8 article of tangible personal property or digital product when the same is not sold but
9 is used, consumed, distributed, or stored for use or consumption in this state;
10 provided there shall be no duplication of the tax.
11 B. There is hereby levied a tax upon the lease or rental within this state of
12 each item or article of tangible personal property or digital product, as defined
13 herein; the levy of said tax to be as follows:
14 (1) At the rate of two per centum (2%) of the gross proceeds derived from
15 the lease or rental of tangible personal property or digital product, as defined herein,
16 where the lease or rental of such property or products is an established business, or
17 part of an established business, or the same is incidental or germane to the said
18 business.
19 (2) At the rate of two per centum (2%) of the monthly lease or rental price
20 paid by lessee or rentee, or contracted or agreed to be paid by lessee or rentee to the
21 owner of the tangible personal property or digital product.
22 * * *
23 D. Notwithstanding any other provision of law to the contrary, no sales or
24 use tax of any taxing authority shall be levied on any advertising service rendered by
25 an advertising business, including but not limited to advertising agencies, design
26 firms, and print and broadcast media, or any member, agent, or employee thereof, to
27 any client whether or not such service also involves a transfer to the client of tangible
28 personal property or digital product. However, a transfer of mass-produced
29 advertising items by an advertising business which manufactures the items itself to
Page 27 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 a client for the client's use, which transfer involves the furnishing of minimal
2 services other than manufacturing services by the advertising business shall be a
3 taxable sale or use of tangible personal property; provided that in no event shall tax
4 be levied on charges for creative services which are separately invoiced.
5 * * *
6 K. An additional tax shall be levied as follows:
7 (1) At the rate of four percent of the sales price of each item or article of
8 tangible personal property or digital product when sold at retail in this state; the tax
9 to be computed on gross sales for the purpose of remitting the amount of tax due the
10 state, and to include each and every retail sale.
11 (2) At the rate of four percent of the cost price of each item or article of
12 tangible personal property or digital product when the same is not sold but is used,
13 consumed, distributed, or stored for use or consumption in this state; provided there
14 shall be no duplication of the tax.
15 * * *
16 U. Collection of consumer use tax. It is the duty of the secretary of the
17 Department of Revenue to collect all taxes imposed pursuant to this Chapter and
18 Chapters 2-A and 2-B of this Subtitle which may be due upon the sale by a remote
19 retailer of tangible personal property, digital products, or services in Louisiana. The
20 secretary is authorized and directed to employ all means available to ensure the
21 collection of the tax in an equitable, efficient, and effective manner.
22 V.(1) In addition to the definition of "dealer" as provided in R.S. 47:301(4)
23 for purposes of the consumer use tax, the term "dealer" includes every person who
24 manufactures or produces tangible personal property or digital product for sale at
25 retail, for use or consumption, or distribution, or for storage to be used or consumed
26 in a taxing jurisdiction. "Dealer" is further defined to mean:
27 (a) Any person engaging in business in the taxing jurisdiction which shall
28 mean the solicitation of business through an independent contractor or any other
29 representative pursuant to an agreement with a Louisiana resident or business under
Page 28 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 which the resident or business, for a commission, referral fee, or other consideration
2 of any kind, directly or indirectly, refers potential customers, whether by link on an
3 internet website, an in-person oral presentation, telemarketing, or otherwise to the
4 seller. If the cumulative gross receipts from sales of tangible personal property or
5 digital product to customers in this state who are referred to the person through such
6 an agreement exceeds fifty thousand dollars during the preceding twelve months, the
7 presumption regarding the status of that person as a dealer may be rebutted if the
8 person can demonstrate, to the satisfaction of the secretary, that he cannot reasonably
9 be expected to have gross receipts in excess of fifty thousand dollars for the
10 succeeding twelve months.
11 (b) Any person selling tangible personal property, digital products, or
12 services, the use of which is taxed pursuant to this Chapter, who:
13 * * *
14 BB. Notwithstanding any other provision of law to the contrary, including
15 but not limited to any contrary provisions of this Chapter, beginning July 1, 2018,
16 through June 30, 2025, there shall be no exemptions and no exclusions to the tax
17 levied pursuant to the provisions of this Section, except for the retail sale, use,
18 consumption, distribution, or storage for use or consumption of the following:
19 * * *
20 (13) Sales, leases, or rentals of tangible personal property or digital products
21 paid by or under the provisions of Medicare as provided in R.S. 47:315.3.
22 * * *
23 (17) Tangible personal property or digital products that are sold or donated
24 to a food bank as provided in R.S. 47:301(10)(j) and (18)(a)(i).
25 * * *
26 (25) Tangible personal property and digital products for resale as provided
27 in R.S. 47:301(10)(a)(i).
28 * * *
Page 29 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (27) Isolated or occasional sales of tangible personal property and digital
2 products by a person not engaged in such business as provided in R.S. 47:301(1) and
3 (10)(c)(ii)(bb).
4 * * *
5 (30) An article traded in on the purchase of tangible personal property and
6 digital product as provided in R.S. 47:301(13)(a).
7 * * *
8 (33) Credit for sales and use taxes paid to another state on tangible personal
9 property or digital products imported in Louisiana as provided in R.S.
10 47:303(A)(3)(a).
11 * * *
12 (56) Transactions in interstate commerce and tangible personal property and
13 digital products imported into this state, or produced or manufactured in this state,
14 for export as provided in R.S. 47:305(E).
15 * * *
16 (66) Sales, leases, and rentals of tangible personal property and digital
17 products to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc. as
18 provided in R.S. 47:301(7)(g) and (10)(r).
19 * * *
20 (81) Sales of admissions, parking fees, and sales of tangible personal
21 property and digital products at events sponsored by domestic, civic, educational,
22 historical, charitable, fraternal, or religious nonprofit organizations as provided in
23 R.S. 47:305.14(A)(1).
24 * * *
25 (109) Sales of tangible personal property, digital products, and services at
26 certain public facilities as provided in R.S. 39:467 and 468.
27 * * *
28 (113) Purchases of tangible personal property and digital products pursuant
29 to the sales tax holiday as provided in R.S. 47:305.74.
Page 30 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 * * *
2 CC. The provisions of Subsection BB of this Section shall supersede and
3 control to the extent of conflict with any other provision of law beginning July 1,
4 2018, through June 30, 2025. Digital products will be taxed in the same manner as
5 any complementary tangible personal property or service included in Subsection BB
6 of this Section.
7 * * *
8 ยง303. Collection
9 A. Collection from dealer.
10 * * *
11 (2) On all tangible personal property or digital products imported, or caused
12 to be imported, from other states or foreign countries, and used by him, the "dealer",
13 as hereinafter defined, shall pay the tax imposed by this Chapter on all articles of
14 tangible personal property or digital products so imported and used, the same as if
15 the said articles had been sold at retail for use or consumption in this state. For the
16 purposes of this Chapter, the use, or consumption, or distribution, or storage to be
17 used or consumed in this state of tangible personal property or digital products, shall
18 each be equivalent to a sale at retail, and the tax shall thereupon immediately levy
19 and be collected in the manner provided herein, provided there shall be no
20 duplication of the tax in any event.
21 (3)(a) A credit against the use tax imposed by this Chapter shall be granted
22 to taxpayers who have paid a similar tax upon the sale or use of the same tangible
23 personal property or digital products in another state. The credit provided herein
24 shall be granted only in the case where the state to which a similar tax has been paid
25 grants a similar credit as provided herein, provided that members of the armed forces
26 who are citizens of this state and whose orders or enlistment contracts stipulate a
27 period of active duty of two years or more and who purchase automobiles outside of
28 the state of Louisiana while on such tour of active duty shall be granted such credit
29 in connection with the purchase of such automobiles whether or not the state to
Page 31 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 which such tax thereon has been paid grants a similar credit as herein provided. The
2 amount of the credit shall be calculated by multiplying the rate of the similar tax paid
3 in the other state by the cost price which is subject to Louisiana use tax at the time
4 of the importation of the tangible personal property or digital products. The proof
5 of payment of a similar tax to another state shall be made according to rules and
6 regulations promulgated by the secretary. In no event shall the credit be greater than
7 the tax imposed by Louisiana upon the particular tangible personal property or digital
8 product which is the subject of the Louisiana use tax.
9 * * *
10 G. Direct Payment Numbers. Notwithstanding any provision of law to the
11 contrary, a Louisiana taxpayer who obtains a DP Number as provided in R.S.
12 47:303.1 shall remit sales and use taxes due on purchases and rentals of tangible
13 personal property, digital products, and taxable services directly to the state and local
14 taxing bodies to whom the sales and use taxes are due, and shall not be liable to remit
15 the tax to the vendor or lessor of the tangible personal property, digital products, and
16 taxable services, as provided in R.S. 47:303.1.
17 * * *
18 ยง303.1. Direct Payment Numbers
19 A. Notwithstanding any other law to the contrary except for the provisions
20 of R.S. 47:303(B) and (E), the state and local sales and use tax due on the purchase,
21 importation, or lease of tangible personal property, digital products, or taxable
22 services by taxpayers who have obtained a Direct Payment Number, hereinafter
23 referred to as a "DP Number," shall be remitted directly to the state and appropriate
24 political subdivision by such taxpayer, as provided in this Section. The vendor or
25 lessor of tangible personal property, digital products, or taxable services shall not be
26 responsible for collecting sales and use tax on such sales or leases, and shall not be
27 liable for such tax as provided in R.S. 47:304(C), upon presentation to him of a valid
28 DP Number by such purchaser or lessee, provided that the vendor or lessor notes the
Page 32 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 DP Number on the untaxed contract or invoice submitted to such purchaser and
2 lessee.
3 B.(1) A DP Number shall be issued to and shall be continued to be held by
4 a taxpayer who obtains the required approvals and who meets all of the qualifications
5 provided for in this Section and the following qualifications:
6 * * *
7 (c) The taxpayer has an annual average of five million dollars of taxable
8 purchases or leases of tangible personal property, digital products, and or taxable
9 services for three calendar years prior to the year of application by the taxpayer, and
10 has such an average for each subsequent three-year period.
11 * * *
12 (2)
13 * * *
14 (b) Separate DP Numbers shall be issued to and shall be continued to be held
15 by taxpayers that are subsidiary entities of a private, nonprofit, tax-exempt
16 organization, as defined under Section 501(c)(3) of the Internal Revenue Code, that
17 meets the requirements of Subparagraph (a) of this Paragraph, as well as to those
18 taxpayer entities in which the tax-exempt organization is the sole member, provided
19 that these entities are licensed by the Louisiana Department of Health, Louisiana
20 Board of Pharmacy, or otherwise have as their mission promoting the delivery of
21 healthcare and patient medical services and products and further provided that these
22 entities and the tax exempt organization together have in the aggregate an annual
23 average of ten million dollars of taxable purchases or leases of tangible personal
24 property, digital products, and or taxable services for three calendar years prior to the
25 year of application, and have such an average for each subsequent three-year period,
26 and which obtain the required approvals and meet the qualifications provided for in
27 Subparagraphs (1)(b) and (1)(d) of this Subsection.
28 * * *
29 ยง304. Treatment of tax by dealer
Page 33 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 * * *
2 B. Every dealer located outside the state making sales of tangible personal
3 property or digital products for distribution, storage, use, or other consumption, in
4 this state, shall at the time of making sales collect the tax imposed by this Chapter
5 from the purchaser.
6 * * *
7 ยง305. Exclusions and exemptions from the tax
8 * * *
9 E. It is not the intention of any taxing authority to levy a tax upon articles of
10 tangible personal property or digital products imported into this state, or produced
11 or manufactured in this state, for export; nor is it the intention of any taxing authority
12 to levy a tax on bona fide interstate commerce; however, nothing herein shall prevent
13 the collection of the taxes due on sales of tangible personal property or digital
14 products into this state which are promoted through the use of catalogs and other
15 means of sales promotion and for which federal legislation or federal jurisprudence
16 enables the enforcement of the sales tax of a taxing authority upon the conduct of
17 such business. It is, however, the intention of the taxing authorities to levy a tax on
18 the sale at retail, the use, the consumption, the distribution, and the storage to be used
19 or consumed in this state, of tangible personal property or digital products after it has
20 they have come to rest in this state and have become a part of the mass of property
21 in this state. At such time as federal legislation or federal jurisprudence as to sales
22 in interstate commerce promoted through the use of catalogs and other means of
23 sales promotions enables the enforcement of this Chapter or any other law or local
24 ordinance imposing a sales tax against vendors that have no other nexus with the
25 taxing jurisdiction, the following provisions shall apply to such sales on which sales
26 and use tax would not otherwise be collected.
27 * * *
28 ยง305.10. Exclusions and exemptions; property purchase for first use outside the
29 state
Page 34 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 A. There shall be no sales or use tax due upon the sale at retail or use of
2 tangible personal property, including diesel fuel, or digital products purchased within
3 or imported into Louisiana for first use exclusively beyond the territorial limits of
4 Louisiana as specifically provided hereinafter in this Section.
5 * * *
6 C. If the first use of tangible personal property or digital products purchased
7 within or imported into Louisiana occurs offshore beyond the territorial limits of any
8 state, the exemption provided herein shall apply only if:
9 (1) The purchaser or importer has determined the location of the first use of
10 the tangible personal property or digital product at the time of its purchase and has
11 notified the vendor of that location; or
12 (2) The purchaser or importer has not determined the intended offshore
13 location of first use at the time of purchase or importation, but has obtained from the
14 secretary of the Department of Revenue an "offshore registration number"
15 authorizing him to claim the exemption under the conditions provided in this
16 Paragraph:
17 (a) Said offshore registration number shall be issued only if the purchaser or
18 importer has shown, to the satisfaction of the secretary, that records, reports, and
19 business practices are sufficient to permit verification that tangible personal property
20 or digital products purchased or imported tax-free under this Subsection is, in fact,
21 being purchased or imported for use offshore beyond the territorial limits of any
22 state. In cases of purchases of fungible goods, including vessel fuel and lubricants,
23 the required records shall include purchase invoices, vessel logs, fuel usage records,
24 fuel transfer records and other reports and records that will enable the secretary to
25 determine the amount of fungible goods consumed within Louisiana so as to be
26 subject to the sales and use tax, and the amount of fungible goods delivered to or
27 consumed at offshore locations beyond the territorial limits of the state, so as not to
28 be subject to the sales and use tax. For the purpose of the Section, the term "fungible
29 goods" means goods of which any unit is unidentifiable and is, from its nature or by
Page 35 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 mercantile custom, treated as the equivalent of any other unit and shall include crude
2 petroleum and its refined products.
3 (b) The offshore registration number issued by the secretary under this
4 Subsection may be revoked by the secretary at any time if the purchaser or importer
5 fails to meet the conditions set herein, or if the secretary finds that the purchaser or
6 importer is consistently using the certificate to purchase or import tax-free tangible
7 personal property or digital products for first use in state.
8 (c) If the offshore registration number is revoked, all tangible personal
9 property or digital products purchased or imported tax-free under this Paragraph and
10 in the possession of the purchaser or importer within this state shall be deemed
11 taxable unless otherwise exempt under the provisions of Paragraph (1) of this
12 Subsection. If the provisions of Paragraph (1) of this Subsection are not complied
13 with, any subsequent purchase or import of tangible personal property will be
14 taxable, whether for instate or offshore use, until the certificate and offshore number
15 are reissued.
16 * * *
17 (3) Except for purchases or importation of tangible personal property or
18 digital products in accordance with Paragraphs (1) and (2) of this Subsection, any
19 purchase or importation of property is taxable at the time of purchase or import
20 unless otherwise exempt.
21 D. If tangible personal property or digital products purchased or imported
22 tax-free under the provisions of this Section is are subsequently used for any taxable
23 purpose within the state, use tax shall be paid by the purchaser or importer as of the
24 time of its use in this state. Storage of property purchased or imported tax-free under
25 this Section which is ultimately used in another state will be considered a
26 "subsequent use for a taxable purpose".
27 E. If tangible personal property or digital products purchased within or
28 imported into the state tax-free under the provisions of this Section is are later
29 returned to Louisiana for use for a taxable purpose, the property shall be subject to
Page 36 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 the Louisiana use tax as of the time it is brought into the state, subject to the credit
2 provided in R.S. 47:303(A).
3 * * *
4 ยง305.14. Exclusions and exemptions; nonprofit organizations; nature of exemption;
5 limitations; qualifications; newspapers; determination of tax exempt status
6 A.(1)(a) The sales and use taxes imposed by taxing authorities shall not
7 apply to sales of tangible personal property or digital products at, or admission
8 charges for, outside gate admissions to, or parking fees associated with, events
9 sponsored by domestic, civic, educational, historical, charitable, fraternal, or
10 religious organizations, which are nonprofit, when the entire proceeds, except for
11 necessary expenses such as fees paid for guest speakers, chair and table rentals, and
12 food and beverage utility related items connected therewith, are used for educational,
13 charitable, religious, or historical restoration purposes, including the furtherance of
14 the civic, educational, historical, charitable, fraternal, or religious purpose of the
15 organization. In addition, newspapers published in this state by religious
16 organizations shall also be exempt from such taxes, provided that the price paid for
17 the newspaper or a subscription to the newspaper does not exceed the cost to publish
18 such newspaper.
19 * * *
20 (5) Notwithstanding any other provision of law to the contrary, for purposes
21 of state and political subdivision sales and use tax, "sales and use" shall not mean the
22 purchase of tangible personal property, digital products, or taxable services, by
23 nonprofit literacy organizations in compliance with the court order from the Dodd
24 Brumfield decision and Section 501(c)(3) of the Internal Revenue Code, limited to
25 books, workbooks, computers, computer software, films, videos, and audio tapes.
26 * * *
27 ยง305.38. Exclusions and exemptions; sheltered workshop or supported employment
28 provider for persons with intellectual disabilities
Page 37 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 The sale at retail, the use, the consumption, the distribution, and the storage
2 for use or consumption in this state of each item or article of tangible personal
3 property or digital products by a sheltered workshop or a supported employment
4 provider as defined in R.S. 39:1604.4 for persons with intellectual disabilities
5 licensed by the Department of Children and Family Services as a day developmental
6 training center for persons with intellectual disabilities shall not be subject to the
7 sales and use taxes levied by the state or by any political subdivision thereof.
8 * * *
9 ยง305.53. Exclusions and exemptions; sickle cell disease organizations
10 A. The sale at retail, the rental or lease, the use, the consumption, the
11 distribution, and the storage for use or consumption in this state of each item or
12 article of tangible personal property, digital products, or any taxable service, by a
13 nonprofit organization established prior to 1975 which conducts a comprehensive
14 program on sickle cell disease which includes but is not limited to free education,
15 free testing, free counseling, and free prescriptions, transportation, and food
16 packages for sickle cell patients shall not be subject to the sales and use taxes levied
17 by the state or by any other tax authority.
18 * * *
19 ยง305.54. Exemption; Annual Louisiana Sales Tax Holidays Act
20 * * *
21 B.(1) Notwithstanding any other provisions of law to the contrary, the sales
22 tax levied by the state of Louisiana and its political subdivisions whose boundaries
23 are coterminous with those of the state shall not apply to the first two thousand five
24 hundred dollars of the sales price or cost price of any consumer purchases of tangible
25 personal property or digital products that occur on the first consecutive Friday and
26 Saturday of August each year.
27 (2) For purposes of this Section,"consumer purchases" shall mean purchases
28 of items of tangible personal property or digital products other than vehicles subject
Page 38 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 to license and title. Consumer purchases shall not include the purchase of meals
2 furnished for consumption on the premises where purchased, including to-go orders.
3 C. This provision will apply if and only if during the time period provided
4 for in Paragraph (B)(1) of this Section, one of the following occurs:
5 (1) Title to or possession of an item of tangible personal property or digital
6 products is transferred from a selling dealer to a purchaser.
7 * * *
8 ยง306.5. Annual reporting requirement
9 A.(1) Notwithstanding any provision of law to the contrary, transactions
10 listed in Subsection B of this Section involving sales of tangible personal property,
11 digital products, or services that are not subject to state sales and use tax pursuant to
12 the exclusions and exemptions provided by law shall be subject to an annual
13 reporting requirement based on transactions occurring during the previous fiscal
14 year, beginning on July first of the preceding year and ending on June thirtieth of the
15 current year.
16 (2) The annual report shall include all of the following information:
17 * * *
18 (c) Annual gross sales of tangible personal property, digital products, or
19 services that are not subject to state sales and use tax pursuant to the exclusions and
20 exemptions provided for in Subsection B of this Section.
21 * * *
22 ยง307. Collector's authority to determine the tax in certain cases
23 A. In the event any dealer fails to make a report and pay the tax as provided
24 in this Chapter or in case the dealer makes a grossly incorrect report or a report that
25 is false or fraudulent, the collector shall make an estimate of the retail sales of such
26 dealer for the taxable period, of the gross proceeds from rentals or leases of tangible
27 personal property by the dealer, or the cost price of all articles of tangible personal
28 property or digital products imported by the dealer for use or consumption or
29 distribution or storage to be used or consumed in this state, and of the gross amounts
Page 39 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 paid or charged for services taxable; and it shall be the duty of the collector to assess
2 and collect the tax together with any interest and penalty that may have accrued
3 thereon, which assessment shall be considered prima facie correct and the burden to
4 show the contrary shall rest upon the dealer.
5 B. In the event the dealer has imported tangible personal property or digital
6 products and he fails to produce an invoice showing the cost price of the articles
7 which are subject to tax, or the invoice does not reflect the true or actual cost, then
8 the collector shall ascertain in any manner feasible the true cost price and shall assess
9 and collect the tax, together with any interest and penalties that may have accrued,
10 on the basis of the true cost as assessed by him. The assessment so made shall be
11 considered prima facie correct, and the burden shall be on the dealer to show the
12 contrary.
13 C. In the case of the lease or rental of tangible personal property or digital
14 products, if the consideration given or reported by the dealer does not, in the
15 judgment of the collector, represent the true or actual consideration, then the
16 collector is authorized to ascertain in any manner feasible the true or actual
17 consideration and assess and collect the tax thereon together with any interest and
18 penalties that may have accrued. The assessment so made shall be considered prima
19 facie correct and the burden shall be on the dealer to show the contrary.
20 * * *
21 ยง309. Dealers required to keep records
22 A.(1) Every dealer required to make a report and pay any tax under this
23 Chapter shall keep and preserve suitable records of the sales, purchases, or leases
24 taxable under this Chapter, and such other books of accounts as may be necessary
25 to determine the amount of tax due hereunder, and other information as may be
26 required by the secretary; and each dealer shall secure, maintain and keep until the
27 taxes to which they relate have prescribed, a complete record of tangible personal
28 property or digital products received, used, sold at retail, distributed, or stored, leased
29 or rented, within this state by the said dealer, together with invoices, bills of lading,
Page 40 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 and other pertinent records and papers as may be required by the secretary for the
2 reasonable administration of this Chapter, and a complete record of all sales or
3 purchases of services taxable under this Chapter until the taxes to which they relate
4 have prescribed.
5 * * *
6 ยง309.1. Sales in Louisiana of tangible personal property, digital products, and
7 taxable services by a dealer or remote retailer; the provision of lists, notices,
8 and statements by a dealer or remote retailer
9 * * *
10 B. Definitions. As used in this Section, the following words and phrases
11 have the following meanings unless the context clearly indicates otherwise:
12 (1) "Louisiana purchaser" or "purchaser" means a person who purchases
13 tangible personal property, digital products, or taxable services in a transaction with
14 a remote retailer for property or a service that is delivered for use or benefit in
15 Louisiana, and no Louisiana sales and use tax was collected or paid on the
16 transaction.
17 (2) "Remote retailer" or "retailer" means a retailer that purposefully avails
18 itself in any way of the benefits of an economic market in Louisiana or who has any
19 other minimum contacts with the state and who meets all of the following criteria:
20 * * *
21 (b) Makes retail sales of tangible personal property, digital products, or
22 taxable services where the property is delivered into Louisiana or the beneficial use
23 of the service occurs in Louisiana, and the cumulative annual gross receipts for the
24 retailer and its affiliates from those sales exceeds fifty thousand dollars per calendar
25 year.
26 * * *
27 D. Annual statement submitted by remote retailer. By March first of each
28 year a remote retailer who made retail sales of tangible personal property, digital
29 products, or taxable services to Louisiana purchasers in the immediately preceding
Page 41 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 calendar year shall file with the secretary an annual statement for each purchaser
2 which includes the total amount paid by the purchaser to that retailer in the
3 immediately preceding calendar year. Under no circumstances shall the statement
4 contain detail as to specific property or services purchased, but it shall include the
5 total amount paid. The statement shall be submitted on forms to be developed and
6 provided by the secretary. The secretary is authorized to require the electronic filing
7 of statements by a remote retailer who had sales in Louisiana in excess of one
8 hundred thousand dollars in the immediately preceding calendar year.
9 * * *
10 ยง310. Wholesalers and jobbers required to keep records
11 A. All wholesale dealers and jobbers in this state shall keep a record of all
12 sales of tangible personal property or digital products made in this state whether such
13 sales be for cash or on terms of credit. These records shall contain and include the
14 name and address of the purchaser, the date of the purchase, the article purchased
15 and the price at which the article is sold to the purchaser. These records shall be kept
16 until the taxes to which they relate have prescribed and shall be open to the
17 inspection of the secretary at all reasonable hours.
18 * * *
19 ยง312. Failure to pay tax on imported tangible personal property or digital products;
20 grounds for attachment
21 A. The failure of any dealer to pay the tax and any interest, penalties, or
22 costs due under the provisions of this Chapter on any tangible personal property or
23 digital products imported from outside the state for use, consumption, distribution
24 or storage to be used in this state, or imported for the purpose of leasing or renting
25 the same, shall make the tax, interest, penalties, or costs ipso facto delinquent. This
26 failure shall moreover be a sufficient ground for the attachment of the personal
27 property imported wherever it may be found, whether the delinquent taxpayer is a
28 resident or nonresident, and whether the property is in the possession of the
29 delinquent taxpayer or in the possession of other persons.
Page 42 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 B. It is the intention of this law to prevent the disposition of the said tangible
2 personal property or digital products in order to insure payment of the tax imposed
3 by this Chapter, together with interest, penalties and costs, and authority to attach is
4 hereby specifically granted to the collector. The procedure prescribed by law in
5 attachment proceedings shall be followed except that no bond shall be required of
6 the State.
7 * * *
8 ยง314. Failure to pay tax; rule to cease business
9 Failure to pay any tax due as provided in this Chapter shall ipso facto,
10 without demand or putting in default, cause the tax, interest, penalties, and costs to
11 become immediately delinquent, and the collector has the authority, on motion in a
12 court of competent jurisdiction, to take a rule on the dealer, to show cause in not less
13 than two or more than ten days, exclusive of holidays, why the dealer should not be
14 ordered to cease from further pursuit of business as a dealer. This rule may be tried
15 out of term and in chambers, and shall always be tried by preference. If the rule is
16 made absolute, the order rendered thereon shall be considered a judgment in favor
17 of the state, prohibiting the dealer from the further pursuit of said business until such
18 time as he has paid the delinquent tax, interest, penalties and costs, and every
19 violation of the injunction shall be considered as a contempt of court, and punished
20 according to law. For the purpose of the enforcement of this Chapter and the
21 collection of the tax levied hereunder, it is presumed that all tangible personal
22 property or digital products imported or held in this state by any dealer is to be sold
23 at retail, used or consumed, or stored for use or consumption in this state, or leased
24 or rented within this state, and is subject to the tax herein levied; this presumption
25 shall be prima facie only, and subject to proof furnished to the collector.
26 ยง315. Sales returned to dealer; credit or refund of tax
27 A. Whenever tangible personal property or digital products are sold is and
28 returned to the dealer by the purchaser or consumer or in the event the amount paid
29 or charged for services is refunded or credited to the purchaser or consumer after the
Page 43 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 tax imposed by this Chapter has been collected, or charged to the account of the
2 purchaser, consumer, or user, the dealer shall be entitled to reimbursement of the
3 amount of tax so collected or charged by him, in the manner prescribed by the
4 collector; and in case the tax has not been remitted by the dealer to the collector, the
5 dealer may deduct the same in submitting his return. Upon receipt of a signed
6 statement of the dealer as to the gross amount of such refunds during the period
7 covered by the signed statement, which period shall not be longer than ninety days,
8 the collector shall issue to the dealer an official credit memorandum equal to the net
9 amount remitted by the dealer for the tax collected. This memorandum shall be
10 accepted by the collector at full face value from the dealer to whom it is issued, in
11 the remittance for subsequent taxes accrued under the provisions of this Chapter. In
12 cases where a dealer has retired from business and has filed a final return, a refund
13 of tax may be made if it can be established to the satisfaction of the collector that the
14 tax paid was not due.
15 B.(1) Whenever the unpaid balance of an account due to the dealer for the
16 purchase of tangible personal property, digital products, or the sale of services
17 subject to sales taxation has been found to be bad in accordance with Section 166 of
18 the United States Internal Revenue Code and has actually been charged off for
19 federal income tax purposes, the dealer shall be entitled to reimbursement of the
20 amount of tax previously paid by the dealer on such amounts.
21 * * *
22 ยง315.3. Sales tax refund; sales and rentals covered by Medicare
23 A. Any person who has paid sales and use taxes, levied by the state and any
24 other taxing authorities in the state, upon the sale, lease, or rental of tangible personal
25 property or digital products when such sale, lease, or rental is paid by or under the
26 provisions of Medicare, shall be entitled to reimbursement of the amount of tax paid
27 on such property. Upon receipt of a signed statement of such person as to the
28 amount of taxes paid under the provisions of this Chapter on such tangible personal
29 property or digital products and upon proof of payment by or under the provisions
Page 44 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 of Medicare, the secretary and the appropriate taxing authorities shall make a refund
2 to such person in the amount to which he is entitled.
3 * * *
4 ยง315.5. Sales tax refund; nonprofits employing or training persons with workplace
5 disabilities or disadvantages
6 A. A qualified charitable institution which submits an application to the
7 secretary of the Department of Revenue shall receive an exemption in the form of a
8 restricted refund of the sales and use tax of the state which the institution has
9 collected on the sale of donated tangible personal property, digital products, or items
10 made from such donated property; provided that, the refund is used exclusively in
11 this state for land acquisition, capital construction, or equipment, or debt service
12 related thereto, and/or job training, job placement, employment, or other related
13 community services and support program costs.
14 B. As used in this Section, "qualified charitable institution" means an
15 organization which meets the following criteria:
16 * * *
17 (3) It routinely sells donated tangible personal property, digital products, or
18 items made from such donated property.
19 * * *
20 C.(1)
21 * * *
22 (c) Once approved, the charitable institution shall file sales tax returns as
23 required reporting the total state sales tax it has collected and take a deduction
24 therefrom for the amount of state sales tax collected on qualifying exempt sales of
25 donated tangible personal property, digital products, or items made from donated
26 tangible personal property.
27 * * *
28 ยง321. Imposition of tax
Page 45 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 A. In addition to the tax levied by R.S. 47:302(A) and 331(A) and collected
2 under the provisions of Chapter 2 of Subtitle II of this Title, there is hereby levied
3 an additional tax upon the sale at retail, the use, the consumption, the distribution,
4 and the storage for use or consumption in this state of each item or article of tangible
5 personal property or digital product, as defined in Chapter 2 of Subtitle II of this
6 Title. The levy of said tax shall be as follows:
7 (1) At the rate of one percent of the sales price of each item or article of
8 tangible personal property or digital product when sold at retail in this state except
9 for prepaid calling service and prepaid wireless calling service, the tax to be
10 computed on gross sales for the purpose of remitting the amount of tax to the state,
11 and to include each and every retail sale.
12 (2) At the rate of one percent of the cost price of each item or article of
13 tangible personal property or digital product except for prepaid calling service and
14 prepaid wireless calling service when the same is not sold but is used, consumed,
15 distributed, or stored for use or consumption in this state, provided that there shall
16 be no duplication of the tax.
17 B. In addition to the tax levied by R.S. 47:302(B) and 331(B) and collected
18 under the provisions of Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised
19 Statutes of 1950, there is hereby levied a tax upon the lease or rental within this state
20 of each item or article of tangible personal property or digital product, as defined by
21 said Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950;
22 the levy of said tax to be as follows:
23 (1) At the rate of one percent of the gross proceeds derived from the lease
24 or rental of tangible personal property or digital product, as defined in Chapter 2 of
25 Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950, where the lease or
26 rental of such property or product is in an established business, or part of an
27 established business, or the same is incidental or germane to the business.
Page 46 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (2) At the rate of one percent of the monthly lease or rental price paid by a
2 lessee or rentee, or contracted or agreed to be paid by a lessee or rentee to the owner
3 of the tangible personal property or digital product.
4 * * *
5 P. Notwithstanding any other provision of law to the contrary, including but
6 not limited to any contrary provisions of this Chapter, beginning July 1, 2018,
7 through June 30, 2025, there shall be no exemptions and no exclusions to the tax
8 levied pursuant to the provisions of this Section, except for the retail sale, use,
9 consumption, distribution, or storage for use or consumption of the following:
10 * * *
11 (9) Installation charges on tangible personal property and digital products as
12 provided in R.S. 47:301(3)(a).
13 * * *
14 (17) Tangible personal property and digital products that are sold or donated
15 to a food bank as provided in R.S. 47:301(10)(j) and (18)(a)(i).
16 * * *
17 (23) Sales, purchases, and leases of tangible personal property and digital
18 products by free hospitals as provided in R.S. 47:301(7)(e), (10)(p), and (18)(c).
19 * * *
20 (25) Tangible personal property and digital products for resale as provided
21 in R.S. 47:301(10)(a)(i).
22 * * *
23 (27) Isolated or occasional sales of tangible personal property and digital
24 products by a person not engaged in such business as provided in R.S. 47:301(1) and
25 (10)(c)(ii)(bb).
26 * * *
27 (30) An article traded in on the purchase of tangible personal property and
28 digital products as provided in R.S. 47:301(13)(a).
29 * * *
Page 47 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (56) Transactions in interstate commerce and tangible personal property and
2 digital products imported into this state, or produced or manufactured in this state,
3 for export as provided in R.S. 47:305(E).
4 * * *
5 (66) Sales, leases, and rentals of tangible personal property and digital
6 products to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc. as
7 provided in R.S. 47:301(7)(g) and (10)(r).
8 * * *
9 (81) Sales of admissions, parking fees, and sales of tangible personal
10 property and digital products at events sponsored by domestic, civic, educational,
11 historical, charitable, fraternal, or religious nonprofit organizations as provided in
12 R.S. 47:305.14(A)(1).
13 * * *
14 (109) Sales of tangible personal property, digital products, and services at
15 certain public facilities as provided in R.S. 39:467 and 468.
16 * * *
17 (114) Purchases of tangible personal property and digital products pursuant
18 to the sales tax holiday as provided in R.S. 47:305.74.
19 * * *
20 Q. The provisions of Subsection P of this Section shall supersede and control
21 to the extent of conflict with any other provision of law beginning July 1, 2018,
22 through June 30, 2025. Digital products will be taxed in the same manner as any
23 complementary tangible personal property or service included in Subsection P of this
24 Section.
25 ยง321.1. Imposition of tax
26 A. In addition to the tax levied by R.S. 47:302(A), 321(A), and 331(A) and
27 collected under the provisions of Chapter 2 of this Subtitle, there is hereby levied an
28 additional tax upon the sale at retail, the use, the consumption, the distribution, and
29 the storage for use or consumption in this state of each item or article of tangible
Page 48 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 personal property or digital product as defined in Chapter 2 of this Subtitle. The levy
2 of said tax shall be as follows:
3 (1) At the rate of forty-five hundredths of one percent of the sales price of
4 each item or article of tangible personal property or digital product when sold at
5 retail in this state, the tax to be computed on gross sales for the purpose of remitting
6 the amount of tax to the state, and to include each and every retail sale.
7 (2) At the rate of forty-five hundredths of one percent of the cost price of
8 each item or article of tangible personal property or digital product when the same
9 is not sold but is used, consumed, distributed, or stored for use or consumption in this
10 state, provided that there shall be no duplication of the tax.
11 B. In addition to the tax levied by R.S. 47:302(B), 321(B), and 331(B) and
12 collected under the provisions of Chapter 2 of this Subtitle, there is hereby levied a
13 tax upon the lease or rental within this state of each item or article of tangible
14 personal property or digital product, as defined by Chapter 2 of this Subtitle; the levy
15 of the tax to be as follows:
16 (1) At the rate of forty-five hundredths of one percent of the gross proceeds
17 derived from the lease or rental of tangible personal property or digital product, as
18 defined in Chapter 2 of this Subtitle, where the lease or rental of such property or
19 product is in an established business, or part of an established business, or the same
20 is incidental or germane to the business.
21 (2) At the rate of forty-five hundredths of one percent of the monthly lease
22 or rental price paid by a lessee or rentee, or contracted or agreed to be paid by a
23 lessee or rentee to the owner of the tangible personal property or digital product.
24 * * *
25 I. Notwithstanding any other provision of law to the contrary, including but
26 not limited to any contrary provisions of this Chapter, beginning July 1, 2018,
27 through June 30, 2025, there shall be no exemptions and no exclusions to the tax
28 levied pursuant to the provisions of this Section, except for the retail sale, use,
29 consumption, distribution, or storage for use or consumption of the following:
Page 49 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 * * *
2 (13) Sales, leases, or rentals of tangible personal property and digital
3 products paid by or under the provisions of Medicare as provided in R.S. 47:315.3.
4 * * *
5 (17) Tangible personal property and digital products that are sold or donated
6 to a food bank as provided in R.S. 47:301(10)(j) and (18)(a)(i).
7 * * *
8 (23) Sales, purchases, and leases of tangible personal property and digital
9 products by free hospitals as provided in R.S. 47:301(7)(e), (10)(p), and (18)(c).
10 * * *
11 (25) Tangible personal property and digital products for resale as provided
12 in R.S. 47:301(10)(a)(i).
13 * * *
14 (27) Isolated or occasional sales of tangible personal property and digital
15 products by a person not engaged in such business as provided in R.S. 47:301(1) and
16 (10)(c)(ii)(bb).
17 * * *
18 (30) An article traded in on the purchase of tangible personal property and
19 digital products as provided in R.S. 47:301(13)(a).
20 * * *
21 (33) Credit for sales and use taxes paid to another state on tangible personal
22 property and digital products imported in Louisiana as provided in R.S.
23 47:303(A)(3)(a).
24 * * *
25 (56) Transactions in interstate commerce and tangible personal property and
26 digital products imported into this state, or produced or manufactured in this state,
27 for export as provided in R.S. 47:305(E).
28 * * *
Page 50 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (66) Sales, leases, and rentals of tangible personal property and digital
2 products to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc. as
3 provided in R.S. 47:301(7)(g) and (10)(r).
4 * * *
5 (81) Sales of admissions, parking fees, and sales of tangible personal
6 property and digital products at events sponsored by domestic, civic, educational,
7 historical, charitable, fraternal, or religious nonprofit organizations as provided in
8 R.S. 47:305.14(A)(1).
9 * * *
10 (109) Sales of tangible personal property, digital products, and services at
11 certain public facilities as provided in R.S. 39:467 and 468.
12 * * *
13 (114) Purchases of tangible personal property and digital products pursuant
14 to the sales tax holiday as provided in R.S. 47:305.74.
15 * * *
16 J. The provisions of Subsection I of this Section shall supersede and control
17 to the extent of conflict with any other provision of law beginning July 1, 2018,
18 through June 30, 2025. Digital products will be taxed in the same manner as any
19 complementary tangible personal property or service included in Subsection I of this
20 Section.
21 * * *
22 ยง331. Imposition of tax
23 A. In addition to the tax levied by R.S. 47:302(A) and collected under the
24 provisions of Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised Statutes
25 of 1950, there is hereby levied an additional tax upon the sale at retail, the use, the
26 consumption, the distribution, and the storage for use or consumption in this state of
27 each item or article of tangible personal property or digital product, as defined in
28 Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950; the
29 levy of said tax to be as follows:
Page 51 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (1) At the rate of ninety-seven one hundredths of one percentum of the sales
2 price of each item or article of tangible personal property or digital product when
3 sold at retail in this state, the tax to be computed on gross sales for the purpose of
4 remitting the amount of tax to the state, and to include each and every retail sale.
5 (2) At the rate of ninety-seven one hundredths of one percentum of the cost
6 price of each item or article of tangible personal property or digital product when the
7 same is not sold but is used, consumed, distributed, or stored for use or consumption
8 in this state, provided that there shall be no duplication of the tax.
9 B. In addition to the tax levied by R.S. 47:302(B) and collected under the
10 provisions of Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised Statutes
11 of 1950, there is hereby levied a tax upon the lease or rental within this state of each
12 item or article of tangible personal property or digital product, as defined by said
13 Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950; the
14 levy of said tax to be as follows:
15 (1) At the rate of ninety-seven one hundredths of one percentum of the gross
16 proceeds derived from the lease or rental of tangible personal property or digital
17 product, as defined in Chapter 2 of Subtitle II of Title 47 of the Louisiana Revised
18 Statutes of 1950, where the lease or rental of such property or product is in an
19 established business, or part of an established business, or the same is incidental or
20 germane to the business.
21 (2) At the rate of ninety-seven one hundredths of one percentum of the
22 monthly lease or rental price paid by a lessee or rentee, or contracted or agreed to be
23 paid by a lessee or rentee to the owner of the tangible personal property or digital
24 product.
25 * * *
26 V. Notwithstanding any other provision of law to the contrary, including but
27 not limited to any contrary provisions of this Chapter, beginning July 1, 2018,
28 through June 30, 2025, there shall be no exemptions and no exclusions to the tax
Page 52 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 levied pursuant to the provisions of this Section, except for the retail sale, use,
2 consumption, distribution, or storage for use or consumption of the following:
3 * * *
4 (13) Sales, leases, or rentals of tangible personal property and digital
5 products paid by or under the provisions of Medicare as provided in R.S. 47:315.3.
6 * * *
7 (17) Tangible personal property and digital products that are sold or donated
8 to a food bank as provided in R.S. 47:301(10)(j) and (18)(a)(i).
9 * * *
10 (23) Sales, purchases, and leases of tangible personal property and digital
11 products by free hospitals as provided in R.S. 47:301(7)(e), (10)(p), and (18)(c).
12 * * *
13 (25) Tangible personal property and digital products for resale as provided
14 in R.S. 47:301(10)(a)(i).
15 * * *
16 (27) Isolated or occasional sales of tangible personal property and digital
17 products by a person not engaged in such business as provided in R.S. 47:301(1) and
18 (10)(c)(ii)(bb).
19 * * *
20 (30) An article traded in on the purchase of tangible personal property and
21 digital products as provided in R.S. 47:301(13)(a).
22 * * *
23 (33) Credit for sales and use taxes paid to another state on tangible personal
24 property and digital products imported in Louisiana as provided in R.S.
25 47:303(A)(3)(a).
26 * * *
27 (56) Transactions in interstate commerce and tangible personal property and
28 digital products imported into this state, or produced or manufactured in this state,
29 for export as provided in R.S. 47:305(E).
Page 53 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 * * *
2 (66) Sales, leases, and rentals of tangible personal property and digital
3 products to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc. as
4 provided in R.S. 47:301(7)(g) and (10)(r).
5 * * *
6 (81) Sales of admissions, parking fees, and sales of tangible personal
7 property and digital products at events sponsored by domestic, civic, educational,
8 historical, charitable, fraternal, or religious nonprofit organizations as provided in
9 R.S. 47:305.14(A)(1).
10 * * *
11 (109) Sales of tangible personal property, digital products, and services at
12 certain public facilities as provided in R.S. 39:467 and 468.
13 * * *
14 (114) Purchases of tangible personal property and digital products pursuant
15 to the sales tax holiday as provided in R.S. 47:305.74.
16 * * *
17 W. The provisions of Subsection V of this Section shall supersede and
18 control to the extent of conflict with any other provision of law beginning July 1,
19 2018, through June 30, 2025. Digital products will be taxed in the same manner as
20 any complementary tangible personal property or service included in Subsection V
21 of this Section.
22 * * *
23 ยง340.1. Marketplace facilitators; collection and remittance of state and local sales
24 and use tax
25 A. Definitions. For purposes of this Section, the following words and
26 phrases shall have the following meanings, unless the context clearly indicates
27 otherwise:
28 * * *
Page 54 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
1 (3) "Marketplace" means any physical or electronic platform or forum,
2 owned, operated, or otherwise controlled by the marketplace facilitator through
3 which a marketplace seller may sell or offer for sale tangible personal property,
4 digital products, or sales of services for delivery into Louisiana.
5 * * *
6 (5) "Marketplace seller" means a person who sells or offers for sale tangible
7 personal property, digital products, or sales of services for delivery into Louisiana
8 through a marketplace that is owned, operated, or controlled by a marketplace
9 facilitator.
10 * * *
11 Section 2. R.S. 51:1286(B) is hereby amended and reenacted to read as follows:
12 ยง1286. Sales and use tax
13 * * *
14 B. The tax so authorized shall be imposed by ordinance adopted by the
15 district without the need of an election and shall be levied upon the sale at retail, the
16 use, the lease or rental, the distribution, the consumption, and the storage for use or
17 consumption of tangible personal property, digital products, and on sales of services
18 in the state of Louisiana, as now or hereafter defined in and as provided by Chapter
19 2 of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950, subject to the
20 exemptions and suspensions of exemptions to the same extent that such exemptions
21 and suspensions of exemptions now or hereafter apply to the tax levied in R.S.
22 47:331.
23 * * *
24 Section 3. R.S. 47:301(16)(h) and (p) and (23) are hereby repealed in their entirety.
25 Section 4. This Act shall become effective on July 1, 2023; if vetoed by the governor
26and subsequently approved by the legislature, this Act shall become effective on July 1,
272023, or on the day following such approval by the legislature, whichever is later.
Page 55 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
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)]
HB 642 Original 2023 Regular Session Jenkins
Abstract: Provides for the levy of sales and use taxes on certain digital products, provides
for administration of sales and use taxes, and provides for exclusions and exemptions
from sales and use taxes.
Present law imposes state sales and use taxes on the sale, use, lease, or rental of tangible
personal property and on sales of services pursuant to the following levies in the following
amounts:
R.S. 47:302 - 2%
R.S. 47:321 - 1%
R.S. 47:321.1 - .45%
R.S. 47:331 - .97%
R.S. 51:1286 - .03%
Proposed law adds digital products to the tax levies. Defines "digital product" as a product
that is transferred electronically or delivered by means other than tangible storage media
through the use of technology having electrical, digital, magnetic, wireless, optical or
electromagnetic, or similar capabilities.
Proposed law provides that "digital product" includes, but is not limited to, all of the
following:
(1)Sounds, images, data, facts, or information, or any combination of these.
(2)Computer software as defined in present law and proposed law.
(3)Charges made to customers for the right to access and use prewritten computer
software, where possession of the software is maintained by the seller or a third party
regardless of whether the charge for the service is on a per use, per user, per license,
subscription or some other basis.
(4)Digital codes (as defined in proposed law).
Proposed law provides that "digital product" does not include any of the following:
(1)Any intangible such as a patent, stock, bond, goodwill, trademark, franchise, or
copyright.
(2)Telecommunications services and ancillary services as those terms are defined in
present law and proposed law.
(3)Internet access service charges.
(4)The representation of a professional service, as described in present law, in an
electronic form, such as an electronic copy of an engineering report prepared by an
engineer that primarily involves the application of human effort, and the human
effort originated after the customer requested the service.
(5)Subscription sales of magazines or periodicals transferred electronically to the buyer.
Page 56 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
(6)Newspapers transferred electronically if the exclusion in present law is in effect.
Present law defines "sales of services" for purposes of sales and use taxes. Proposed law
retains present law and additionally provides that "sales of services" includes the furnishing
of a digital automated service. Defines "digital automated service" as any service transferred
electronically that uses one or more software applications either prewritten or custom, as
well as components that are similar to stand-alone digital products.
Proposed law provides that "digital automated service" does not include any of the
following:
(1)Any service that primarily involves the application of human effort, and the human
effort originated after the customer requested the service.
(2)The loaning or transferring of money or the purchase, sale, or transfer of financial
instruments. "Financial instruments" includes cash, accounts receivable and payable,
loans and notes receivable and payable, debt securities, equity securities, as well as
derivative contracts such as forward contracts, swap contracts, and options.
(3)Dispensing cash or other physical items from a machine.
(4)Payment processing services.
(5)Pari-mutuel wagering or fantasy sports betting.
(6)Telecommunications services and ancillary services as those terms are defined in
present law and proposed law.
(7)Internet access service charges.
(8)Online educational programs provided by any of the following:
(a)A public or private elementary or secondary school.
(b)An institution of higher education as defined in present federal law (20
U.S.C. 1001 and 1002), as existing on July 1, 2009, if the online educational
program is encompassed within the institution's accreditation.
(9)Travel agent services, including online travel services, and automated systems used
by travel agents to book reservations.
(10)Live presentations, such as lectures, seminars, workshops, or courses, where
participants are connected to other participants via the internet or
telecommunications equipment, which allows audience members and the presenter
or instructor to give, receive, and discuss information with each other in real time.
(11)A service that allows the person receiving the service to make online sales of
products or services, digital or otherwise, using the service provider's website.
(12)Advertising services. Defines "advertising services" to mean all services directly
related to the creation, preparation, production, or the dissemination of
advertisements. Provides that "advertising services" includes layout, art direction,
graphic design, mechanical preparation, production supervision, placement, and
rendering advice to a client concerning the best methods of advertising that client's
products or services. "Advertising services" also includes online referrals, search
engine marketing and lead generation optimization, web campaign planning, the
acquisition of advertising space in the internet media, and the monitoring and
evaluation of website traffic for purposes of determining the effectiveness of an
Page 57 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
advertising campaign. "Advertising services" does not include web hosting services
and domain name registration.
Present law provides additional definitions applicable to sales and use taxes. Proposed law
amends various definitions including "cost price", "dealer", "gross sales", "lease or rental",
"purchaser", "retail sale", and "sales price" to include digital products.
Proposed law provides that for purposes of taxes imposed under present law (Chapter 2, 2-A
or 2-C of Title 47), whenever the words "property" or "personal property" are used, those
terms shall be construed to include any digital product unless:
(1)It is clear from the context that the term "personal property" is intended to refer only
to tangible personal property.
(2)It is clear from the context that the term "property" is intended to refer only to
tangible personal property, real property, or both.
(3)To construe the term "property" or "personal property" as including any digital
product would yield unlikely, absurd, or strained consequences.
Proposed law provides that for purposes of the taxes imposed in present law and proposed
law, the Dept. of Revenue may not consider a person's ownership of, or rights in digital
products residing on servers located in this state in determining whether the person has
substantial nexus with this state. "Substantial nexus" means the requisite connection that a
person has with a state to allow the state to subject the person to the state's taxing authority,
consistent with the commerce clause of the U.S. Constitution
Proposed law provides that purchasers of digital products shall amnesty for failing to collect
or pay state sales and use taxes accrued before July 1, 2023 on the sale or use of digital
products. However, amnesty does not apply in cases where state sales taxes were collected
from buyers but these taxes were not remitted to the department.
Proposed law provides that it shall not be construed as authorizing the refund of state sales
and use taxes properly paid on the sale or use of digital products before July 1, 2023
Proposed law provides for applicability of proposed law relative to multiple points of use
and bundled transactions and for sourcing for use tax purposes.
Proposed law authorizes the secretary of the Dept. of Revenue to promulgate rules and
regulations in accordance with present law (Administrative Procedure Act) to implement the
provisions of proposed law, including rules addressing the taxation of any and all digital
products and services. Provides that any rule promulgated by the department shall be
construed in favor of the secretary.
Present law provides for various exclusions and exemptions for sales and use taxes.
Proposed law amends present law to include digital products in certain exclusions and
exemptions, including those relative to sales, leases, or rentals of tangible personal property
or digital products paid by or under the provisions of Medicare; tangible personal property
or digital products that are sold or donated to a food bank; tangible personal property or
digital products for resale as provided in present law (R.S. 47:301(10)(a)(i)); isolated or
occasional sales of tangible personal property or digital products by a person not engaged
in such business; an article traded in on the purchase of tangible personal property or digital
product; credit for sales and use taxes paid to another state on tangible personal property or
digital products imported in La.; transactions in interstate commerce and tangible personal
property or digital products imported into this state, or produced or manufactured in this
state, for export; sales, leases, and rentals of tangible personal property or digital products
to Boys State of Louisiana, Inc. and Girls State of Louisiana, Inc.; sales of admissions,
parking fees, and sales of tangible personal property or digital products at events sponsored
Page 58 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 23RS-1295 ORIGINAL
HB NO. 642
by domestic, civic, educational, historical, charitable, fraternal, or religious nonprofit
organizations; sales of tangible personal property or digital products and services at certain
public facilities; and purchases of tangible personal property or digital products pursuant to
the sales tax holiday as provided in present law (R.S. 47:305.74). Requires that digital
products to be taxed in the same manner as any complementary tangible personal property
or service included in present law.
Effective July 1, 2023.
(Amends R.S. 47:301(3)(a), (b), and (i)(ii)(aa)(I)(aaa), (4)(intro. para.), (a) through (e), (h),
and (i), (5), (7)(a), (g), and (i), (8)(b), (9), (10)(a)(i), (ii), and (iii), (c)(ii)(bb), (j), (q)(i), (r),
(s), (u), (ff), and (hh), (12), (13)(a), (14)(h), (i), (j), and (k), (15), (18)(a), (d)(i), (e), and (f),
(19), and (29)(x)(ix), 302(A), (B), (D), (K)(1) and (2), (U), (V)(1)(intro. para.), (a), and
(b)(intro. para.), (BB)(13), (17), (25), (27), (30), (33), (56), (66), (81), (109), and (113), and
(CC), 303(A)(2) and (3)(a) and (G), 303.1(A) and (B)(1)(c) and (2)(b), 304(B), 305(E),
305.10(A), (C)(intro. para.), (1), (2)(a), (b), and (c), and (3), (D), and (E), 305.14(A)(1)(a)
and (5), 305.38, 305.53(A), 305.54(B) and (C)(1), 306.5(A)(1) and (2)(c), 307(A), (B), and
(C), 309(A)(1), 309.1(B)(1) and (2)(b) and (D), 310(A), 312, 314, 315(A) and (B)(1),
315.3(A), 315.5(A), (B)(3), and (C)(1)(c), 321(A), (B), (P)(9), (17), (23), (25), (27), (30),
(56), (66), (81), (109), and (114), and (Q), 321.1(A), (B), (I)(13), (17), (23), (25), (27), (30),
(33), (56), (66), (81), (109), and (114), and (J), 331(A), (B), (V)(13), (17), (23), (25), (27),
(30), (33), (56), (66), (81), (109), and (114), and (W), and 340.1(A)(3) and (5) and R.S.
51:1286(B); Adds R.S. 47:301(10)(c)(ii)(cc), (jj), and (kk), (14)(l), (32), (33), and (34), and
301.3; Repeals R.S. 47:301(16)(h) and (p) and (23))
Page 59 of 59
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.