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Most Louisianans Are Breaking the Law

  • Nov 2, 2015 | Gail Cole

 Louisiana lawmakers consider Internet sales tax.

Most people in Louisiana do not pay sales or use tax on online purchasers from out-of-state businesses, according to Representative Julie Stokes (R-Kenner). That means they’re breaking the law, and it’s contributing to the $1 billion hole in the state budget. Sales tax generates close to 40% of the state general fund.

“You’re legally required to put your vendor purchases on your Louisiana return,” Rep. Stokes says. “If you’re not doing that, like I think 99 percent of people aren’t, you’re actually breaking the law” (WRBRZ.com).

Many out-of-state vendors are not required to collect Louisiana sales tax. However, if sales tax isn’t collected by the seller at the time of sale, Louisiana taxpayers are required to report and pay the equivalent consumer use tax. The Louisiana Department of Revenue reminds, “The purpose of the use tax is not only to raise revenue, but also to prevent retailers located out-of-state from having an unfair competitive advantage against in-state retailers who have to charge the sales tax.” No matter where you live in Louisiana or what your local sales tax rate is, the use tax rate is 8%.

Rep. Stokes is chairing a committee working to “revamp the state’s sales tax code.” The Sales Tax Streamlining and Modernization Commission is looking at several options, including broadening the tax base (and lowering rates) and implementing an Internet sales tax. It has its work cut out: according to the Tax Foundation, “Louisiana’s sales tax is one of the most unique and challenging of any in the country.”

Find accurate local sales tax rates in Louisiana and other states with this free sales tax rate map.

photo credit: alles-schlumpf via photopin cc

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.