Lawmakers and realtors across the state are taking preemptive action to stop the implementation of new taxation on real estate sales.
A bill to add a constitutional amendment prohibiting any new taxation on real estate transfers passed through the Louisiana House of Representatives last week and is now headed to the state Senate.
Representative Gary Smith Jr. is co-author of the bill and said he thinks it is a very important piece of legislation for the local economy.
“It’s important in these trying times that we don’t put an extra burden on the American dream of owning a home – it’s already expensive enough in this day and age to go out and purchase land or purchase a home,” Smith said. “The real estate market has hurt enough already.”
Currently there is no transfer tax at the state level in Louisiana, but Smith said other states have implemented the payment.
“In other states they have a tax, so when you buy a piece of property you have to pay a documentation fee or land stamp fee…I just don’t think that’s right,” he said. “Even the small amounts that have been suggested…equal to real dollars when you’re talking about the size of purchases that you get into with real estate.”
Eliza Eugene, president of the Saints Board of Realtors, was in Baton Rouge lobbying for the passage of the bill.
“This transfer tax has been implemented in other states and now we’re trying to protect the residents of Louisiana,” Eugene said. “It would impact us in a negative way if it did not pass because…a buyer would need additional funds, even if the seller is assisting in closing costs.”
Eugene said that even a small additional tax would be detrimental to local real estate sales.
“Basically, it would mean that if you buy a house for $150,000 you will have to come to the table with an additional $4,500 in addition to your closing costs and down payments,” she said. “In St. Charles Parish we don’t have this transfer tax, and we don’t want it.”
Proponents of the bill are using the slogan “Say ‘yes’ to no new transfer taxes” to try to spread their message. If the bill passes through the Senate in the coming month, then residents will get a chance to vote on the measure on the November ballot.
Smith said he is optimistic that the bill will pass the Senate.
“It got a wide range of support from both sides of the aisle (in the House),” Smith said. “I’m fairly certain it will pass the Senate, but things happen…this process is certainly a very fluid one that changes from committee to floor, but I feel like this has wide support across the legislature.
“If it passes the Senate as well, voters can decide in November if they feel it’s important enough to put in the constitution to keep this from being a fee or tax on the state level.”
Be the first to comment