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Rs 47:301.2 Sales Tax Streamlining And Modernization Commission

§301.2. Sales Tax Streamlining and Modernization Commission

A. Purpose. The legislature hereby recognizes that:

(1) The sales and use taxes on tangible personal property, services, rentals, and leases

hereinafter referred to as "sales tax", represent one of Louisiana's two major revenue sources,

representing an average of forty percent of state general fund receipts.

(2) The sales tax is the main source of revenue for most of Louisiana's local

governments.

(3) There exist significant structural issues impacting the state and local sales taxes,

which include legislative actions that adversely impact the tax base, a distinct shift away

from a goods-based to a services-based economy, and an increasing shift from "brick and

mortar" retail transactions to e-commerce purchases.

(4) The combined average sales tax rate of 8.9% for Louisiana was the third highest

in the nation as reported by the Tax Foundation in 2014.

(5) The legislature further recognizes that it is good public policy to contemplate

modernization of the sales tax structure to reflect the twenty-first century economy as a way

to aid in stabilizing the sales tax as a revenue source for the state and its local governments.

B. Sales Tax Streamlining and Modernization Commission. For these reasons, the

Sales Tax Streamlining and Modernization Commission, hereinafter referred to as

"commission", is hereby established to perform a comprehensive study of Louisiana's state

and local sales tax systems, and to make recommendations to the legislature regarding

revision of practices, administrative procedure, statutory law, and Louisiana Constitution,

all for the purpose of streamlining and modernizing this vital revenue source for the state and

its local governments. The recommendations shall encompass an overall goal of ensuring

both revenue stability and taxpayer equity through the adoption of proven contemporary tax

policies. The policies shall be based on the concept of a low tax rate with a broad base to be

administered fairly and efficiently.

C. Members. The commission shall consist of the following twenty members, who

shall serve without compensation except for their reasonable and necessary expenses related

to the performance of their duties as members of the commission, and then only in such

amounts as is provided by law for state employees and officials, or per diem or expense

reimbursement to which they may be individually entitled as members of their constituent

organizations:

(1) The speaker of the House of Representatives or his designee.

(2) The president of the Senate or his designee.

(3) The chairman of the House Committee on Ways and Means or his designee.

(4) The chairman of the Senate Committee on Revenue and Fiscal Affairs or his

designee.

(5) A member appointed by the Police Jury Association of Louisiana.

(6) A member appointed by the Louisiana Municipal Association.

(7) A member appointed by the Louisiana School Boards Association.

(8) A member appointed by the Louisiana Association of Tax Administrators.

(9) A member appointed by the Louisiana Sheriffs Association.

(10) A member appointed by the Louisiana Multiparish Tax Commission.

(11) A member appointed by the Louisiana Association of Business and Industry.

(12) A member appointed by the Louisiana Retailers Association.

(13) A member appointed by the Louisiana Automobile Dealers Association.

(14) A member appointed by the National Federation of Independent Business.

(15) A member appointed by Louisiana Industrial Development Executives

Association.

(16) A member appointed by Society of Louisiana Certified Public Accountants.

(17) A member appointed by the Public Affairs Research Council of Louisiana.

(18) A member appointed by The Tax Foundation.

(19) The secretary of the Department of Revenue or his designee.

(20) The Legislative Auditor, or his designee.

D. Meetings. (1) The commission shall conduct monthly meetings and may

consider testimony from witnesses and documents produced for purposes of the commission.

The first meeting shall be held no later than July 31, 2015. A majority of the commission

members shall constitute a quorum. Meetings of the commission shall be held at the state

capitol and be open to the public, pursuant to the provisions of R.S. 42:12 et seq.

(2) The commission shall elect a chairman at its first meeting by a majority vote of

a quorum of the members present and voting. The chairman shall prepare the schedules and

agendas for meetings, and shall coordinate the staff support deemed necessary for the

function of the commission. The following organizations shall assist the commission with

staff support as may be required:

(a) Louisiana Department of Revenue.

(b) Staff of the House of Representatives, Senate, Legislative Fiscal Office, and

Legislative Auditor's Office.

(3) The commission, by majority vote of members present and voting, may establish

subcommittees and provide for guidelines and timetables for their reports to the commission.

E. Studies. The duty of the commission shall be to perform a comprehensive study

of the following issues relating to Louisiana's state and local sales tax systems and to develop

specific recommendations for legislative consideration relative thereto:

(1) A study of how Louisiana state and local sales tax policy affects the economy of

our state, and how changes in such policy may better position Louisiana for the future in

terms of equity and economic competitiveness.

(2) A study of the state and local government sales tax bases and rates and, to the

degree practicable, how those compare with that of other states with similar demographics

and economies. This shall include examination of the concept of broadening the tax base to

allow for lower rates and a more equitable system. Given the global shift of economic

activity from goods-based to services-based consumption, such study shall specifically

include consideration of the taxation of services as a way to strengthen the base and also to

help offset the otherwise regressive nature of a sales tax structure where few services are

taxed. Further, this study shall include consideration of the impact of tax rates on the

deleterious effects of the migration of economic consumption from land-based to the

Internet, not only on state and local revenue stability, but also on the economic

competitiveness and survival of Louisiana's retail businesses, which local businesses are

critical to the vitality of the cultural and community life in this state.

(3) A study of all special tax treatment against sales tax, inclusive of credits,

deductions, discounts, exclusions, exemptions, and rebates. This shall include, to the degree

practicable, a comparison to that of other states with similar populations and economies.

(4) A study of state and local government sales tax collection and audit procedures

and, to the degree practicable, a comparison to that of other states which are considered at

a national level to have an efficient, contemporary administrative and procedural scheme.

F. There shall be a subcommittee established for the development of

recommendations to be presented to the commission concerning potential policy changes

regarding coordinated multi-parish sales and use tax audits. The subcommittee shall be

composed of the commission members representing the Police Jury Association of

Louisiana, the Louisiana Municipal Association, the Louisiana School Boards Association,

the Louisiana Association of Tax Administrators, the Louisiana Sheriffs Association, the

Louisiana Multi-parish Tax Commission, the Department of Revenue, and the Louisiana

Legislative Auditor. The members of the subcommittee shall elect a chairman as approved

by a majority of the members of the subcommittee. The subcommittee's report shall be

presented to the commission by January 15, 2017.

G. Reports and Recommendations. The commission shall review any reports of the

research groups and subcommittees, and after having conducted its comprehensive review,

shall prepare a report of its recommendations for any revision of current practices,

administrative procedure, statutory law, and Louisiana constitution. A recommendation

concerning the collection or administration of local sales and use taxes shall require approval

of three-quarters of the members of the commission. The commission's interim report shall

be submitted to the governor, the president of the Senate, and the speaker of the House of

Representatives no later than January 15, 2016. The final report shall be prepared as

determined by the commission.

H. Sunset. The commission shall terminate on June 30, 2017, but if approved by a

two-thirds vote of the membership prior to June 30, 2017, the commission may continue its

work through June 30, 2018.

Acts 2015, No. 405, §1, eff. July 1, 2015; Acts 2016, No. 564, §1.

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Local Government
Louisiana
3
8
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John Bel Edwards
John Bel Edwards
January 11, 2016 -
Democratic
1-225-342-4404
900 North 3rd Street, Baton Rouge, LA, 70802

Keywords
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louisiana
sales
member
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association
base
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study
recommendation