Louisiana Sales Tax: Internet and Out Of State Businesses
- Apr 2, 2012 | Susan McLain
Louisiana House Bill 1027 (HB 1027), proposed on March 28, 2012, presents the Louisiana legislature with a bill that enables the state to require Internet retailers to collect and remit sales tax to the state as well as out-of-state dealers or merchants who fall into the new definition of “dealer.”
According to HB 1027, “’Dealer’ includes every person who manufactures or produces tangible personal property for sale at retail, for use, or consumption, or distribution, or for storage to be used or consumed in a taxing jurisdiction.” If that definition isn’t clear enough, “any person engaging in business” is defined as anyone “…maintaining directly, indirectly, or through a subsidiary, an office, distribution house, sales house, warehouse, or other place or location of business, or by having an agent, salesman, independent contractor, or solicitor operating within the taxing jurisdiction under the authority of or through an agreement with the seller….”
“Engaging in business” is also expanded to include business interactions where there “…is an agreement with a Louisiana resident or business under which the resident or business, for a commission, referral fee, or other consideration of any kind, directly or indirectly refers potential customers, whether by link on an Internet website or otherwise, to the seller.”
According to Tax Analysts, a nexus bill was opposed by the governor last year. In addition, changes seem to indicate that nexus would be created for Internet retailers with or without affiliates.