The state House of Representatives will soon hear a bill that would require online retailers like Amazon to track purchases made by Louisiana residents and report to the state how much in sales taxes they owe.
Approved by the Ways and Means Committee on Monday with no objection, the bill would also force online retailers to notify customers of their obligation to self-report, which would be accomplished with a simple document that would arrive inside shipping boxes and alongside purchases.
The bill was introduced by Speaker Pro Tem Walt Leger, D-New Orleans, who was also the author of Act 22 from the first special session earlier this year. That act, passed by the House and Senate and endorsed by the governor, created a framework for collecting Internet sales taxes and Leger is now trying to build on it with HB 1121.
Act 22 simply requires out-of-state online retailers with contract affiliates in Louisiana to collect and remit sales taxes. Local governments and the state are splitting the collected 8 percent sales tax.
“I think we all knew at the time this wouldn’t solve the problem entirely,” said Leger, noting sales taxes have always been due on such purchases, but there were collection challenges.
The new system has only been in place for roughly a month, but Leger sees an opportunity to expand on it by implementing a nexus model from Colorado that has been upheld by the 10th Circuit Court of Appeal.
Like Act 22, Leger’s HB 1121 would only apply to remote retailers that do $50,000 worth of business in Louisiana annually. Unlike Act 22, it doesn’t matter if they have contract affiliates here — so it casts a wide net and would capture major Internet players like Amazon.
The legislation would require online retailers to submit to the Department of Revenue a list of all customers who have made purchases greater than $250.
It has some bipartisan support, with Rep. Pat Connick, R-Metairie, deciding not to file a similar measure and throwing support to the bill by Leger.
In Colorado, Amazon recently decided to stop sending the state its list of customers and has begun collecting sales taxes on behalf of the state. Some studies have suggested Louisiana could receive up to $75 million annually if just Amazon, and no other online retailers, do the same here. “It’s hard to even know how much money it would bring in, but this is a step in the right direction,” said Leger. Sales tax fixes awaiting actionFeeling that the temporary increases in sales taxes, from Act 25 from the first special session earlier this year, had a few unintended consequences, Reps. Jay Morris, the original author, and Phillip DeVillier are pushing proposed rebates to make agriculture and automobile interests whole, or close to it.
Both bills have been assigned to the Ways and Means
Committee, but have not yet been put on an agenda. Morris, R-Monroe, has HB 1011, which is a rebate for agriculture manufacturing machinery and equipment, which the author said was not supposed to be subject to the new temporary sales tax increase.
Morris is unsure how much money his bill would deduct from the revenue the state is expecting to receive from Act 25. Morris also said he’s more concerned with making sure his bill, should it move, not be loaded down with amendments seeking to protect other interests.
“No hitchhikers,” he said, promising to keep his bill clean if it advances.
DeVillier, R-Eunice, said he would take a similar approach to his HB 1055, which would offer a rebate for the sales taxes that are having to be applied by automobile dealers to their manufacturer’s rebates.
“That’s not something we’ve ever taxed,” said DeVillier, who was asked by a local dealer in his district to look into the issue. Constitutional convention bill movingThe House and Governmental Affairs Committee has been debating several different bills aimed at reforming how the Legislature does its job and has rejected many of them, but it did advance a framework recently for a possible constitutional convention.
HB 733 by Ways and Means Chairman Neil Abramson, D-New Orleans, would leave it up to an “Evaluation and Drafting Committee” to determine if a convention is really needed and then, and only then, would it be called.
The study group would develop a plan and a draft constitution that would be debated and voted on by 123 delegates, of which 105 would be elected from existing House districts and 18 would be appointed.
Abramson said the state’s guiding charter, drafted in 1974, has become bloated with 183 amendments that lawmakers have sent to voters.
“We put everything in the Constitution, even things that shouldn’t be in there,” he said.
If his bill passes and the study committee calls for a convention, it would lead to a new constitution by May of 2018.
The measure has been recommitted to the Appropriations Committee for another hearing. If passed there, it would then move to House floor.Former Jindal aide opens shopMike Reed, who served as former Gov. Bobby Jindal’s communications director, has launched a strategy and research firm called River Delta Strategies.
Reed said the firm will serve both corporate and political clients, offering public relations, government relations and public affairs strategy. It will also specialize in opposition research, policy analysis and legislative-tracking services.
The Boston native, who has worked in D.C., added that he hopes to help clients at the federal and state levels.They Said It“I’m not for any deal around here if I’m not a part of it.”
—Sen. Francis Thompson“If you’re not a political person then you need to get out of where you’re at because you won’t be there long.”
—Rep. Steve Pylant, to a Division of Administration staffer who said he wasn’t political