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Louisiana: Internet Sales Tax Starts April 2016


 Louisianans who shop online may have to pay sales tax beginning April 1, 2016.

It’s no April Fools’ hoax. Beginning April 1, 2016, certain remote retailers are required to collect and remit Louisiana sales tax under the state’s new affiliate and click-through nexus law.

Click-through nexus

The law expands the definition of “dealer” to include the people who solicit business “through an independent contractor or any other representative pursuant to 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, an in-personal oral presentation, telemarketing, or otherwise to the seller.”

Such dealers must collect and remit Louisiana sales tax “If the cumulative gross receipts from sales of tangible personal property to customers in this state who are referred through such an agreement exceed fifty thousand dollars ($50,000) during the preceding twelve months.”

Affiliate nexus

Also under the new law, a “dealer” is any person selling taxable tangible personal property who:

  • Sells the same or substantially similar line of products as a Louisiana retailer
  • Solicits business and develops and maintains a market in Louisiana through an “affiliated agent”— an agent, salesman, independent contractor, solicitor, or other representative who refers business for consideration of any kind.
  • Holds a substantial ownership interest, directly or through a subsidiary, in a retailer maintaining sales locations in Louisiana, or by a parent or subsidiary thereof.

Additional information is available in HB 30, Act 22.

Federal legislation welcome

HB 30 concludes with a stipulation that any federal legislation authorizing states to require a remote seller to collect sales tax on taxable transactions would preempt the provisions created under the bill.

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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.