INTERNET SALES TAX IN LA. - A big perk of internet shopping
has been not having to pay sales taxes on purchases. But this put brick-and-mortar retailers, those businesses that had a physical presence -- at a disadvantage as they had to collect and pay state and local sales taxes and consequently cities and state governments would lose out on millions of dollars in revenue. Last year The U.S. Supreme Court ruled that states could collect sales tax on internet purchases … as long as the process wouldn’t put an “undue burden on businesses when it comes to collecting sales tax.” Louisiana has a somewhat unique method for collecting sales tax and this is where things could get sticky.
Robert Travis Scott is President of the Public Affairs Research Council of Louisiana. He explains to Public Radio WRKF in Baton Rouge about the difficulty Louisiana faces when it comes to collecting internet sales tax.
"We have a highly decentralized tax collection system, the local governments--the parishes collect the sales taxes in our state,"Scott explained. "We're one of only three states that does it this way. So the problem that you run into when you're trying to implement a new system like this is who's actually goin g to be the one collecting and remitting the taxes? Is it going to be local officials as they have been in the past with traditional transactions or is it going to be this new state commission that's been set up to handle this particular category of transactions?"
The rollout for collecting Internet Sales Tax for Louisiana is going to be gradual, making it optional for remote sellers, but Scott says once the wrinkles get ironed out, the process will eventually become mandatory. For Louisiana about a third of revenues that go into its general fund are from sales taxes.
