Expands an exclusion from state and local sales tax for repairs to certain property which is delivered out of state. (7/1/13)
Impact
The proposed changes under SB 80 would amend the existing definitions outlined in R.S. 47:301 and repeal specific provisions from R.S. 47:337.10(F). This is expected to simplify tax regulations related to repair services by making it clearer which services are exempt from sales tax for out-of-state deliveries. Moreover, moving the exclusion from being limited to just East Feliciana Parish to applying to all local sales taxes is a significant shift in policy, potentially impacting both state revenues and local fiscal dynamics across various jurisdictions.
Summary
Senate Bill 80, introduced by Senator Martiny, aims to expand the exclusion from state and local sales tax for certain repair services of tangible personal property delivered out of state. The bill specifically allows for repairs that are delivered either by common carriers or directly by the repair dealer's vehicle, enhancing the scope of services that could qualify for tax exemptions. This change is intended to benefit businesses that serve customers outside Louisiana, potentially encouraging inter-state commerce by reducing the financial burdens imposed by sales taxes on repairs.
Sentiment
The sentiment surrounding SB 80 has been generally positive among those who support its intention to bolster business competitiveness. Advocates argue that it levels the playing field for repair businesses by ensuring that they are not penalized for facilitating out-of-state commerce, which, in turn, could enhance economic activity. Conversely, there may be concerns regarding possible loss of tax revenue for local governments, leading to division among different stakeholders in the community about the bill's advantages and drawbacks.
Contention
Noteworthy points of contention may arise around the implications of broadening the exclusion to encompass local sales taxes, which opens up discussions about local government funding. Critics could argue that easing tax burdens on repair services delivered out of state could foster inequity in the taxation system, potentially adversely affecting local budgets that rely on sales tax revenues. As such, while the bill seeks to promote business interests, it raises essential discussions about equitable tax practices and the financial impact on local authorities.
Provides for certain tax authorities to grant an exclusion from sales tax for repairs to certain property which is delivered out of state. (7/1/13) (EN SEE FISC NOTE LF RV)
Requires that certain repairs to tangible personal property be excluded from state sales and use taxes and sales and use taxes in East Feliciana Parish (EG SEE FISC NOTE LF RV See Note)
Requires that certain repairs to tangible personal property be excluded from local sales and use taxes in East Feliciana Parish (OR SEE FISC NOTE LF RV)
Excludes certain repairs on tangible personal property from local sales and use tax by certain taxing authorities in Calcasieu Parish (EN SEE FISC NOTE LF RV See Note)
Provides for the extent of applicability of various exclusions and exemptions from state sales and use tax (Item #36) (EG +$789,900,000 GF RV See Note)
To establish a framework upon which to repeal the property tax on business inventories and offshore vessels as well as the state income tax credits associated therewith through the repeal of a state sales and use tax, the levy of a limited, temporary state sales and use tax, and limitations on the applicability of certain exclusions and exemptions from certain state sales and use taxes (Items #31 and 36) (OR SEE FISC NOTE GF RV)