Menu
Tax Notes logo

Louisiana Lawmakers to Prioritize Centralized Sales Tax System

Posted on Feb. 23, 2021

Establishing a centralized sales and use tax system in Louisiana will be a top priority for the upcoming legislative session, according to House Speaker Clay Schexnayder (R).

Schexnayder said in a release that he will sponsor a constitutional amendment to create a centralized sales tax collection system in Louisiana to “streamline the process and help create more jobs, just like we did with our lawsuit reforms last year to lower auto insurance rates.” 

“Louisiana is one of only two states in America that uses this outdated form of sales tax collection, making it harder for business to operate in this state,” according to Schexnayder, who in 2020 introduced a resolution (H.R. 31) to establish the state’s Centralized Sales and Use Tax Administration Study Group. The resolution creating the group was based on recommendations from Louisiana’s Economic Recovery Task Force, a coalition of business leaders who were asked for suggestions to help the state recover from the COVID-19 crisis. 

In its final report, submitted to the Legislature February 18, the study group recommended that the Legislature propose a constitutional amendment authorizing the creation of a single sales and use tax collection board. The board, to be funded by state and local revenues, would function as a statewide political subdivision and would collect state and local sales and use taxes.

During its final meeting in November 2020, the study group voted unanimously to recommend that the Legislature create a sales tax board based on a proposal by the Louisiana Association of Tax Administrators. The group also said it would finalize details on points of contention, including the makeup of the board and its auditing function.

The proposal — backed by local associations, including the Louisiana Sheriff’s Association, the Louisiana Municipal Association, the Police Jury Association of Louisiana, and the Louisiana School Board Association — was viewed as a major step forward for centralized collections. Historically local governments have been opposed to a centralized system. 

Jason DeCuir, chair of the study group, told Tax Notes that both chambers of the Legislature are putting together a package of tax reform bills with the goal of making the state’s tax structure more competitive, both regionally and nationally. 

This constitutional amendment “is going to be a major focal point of these tax reform efforts,” according to DeCuir, who is a lobbyist at Advantous Consulting LLC

The upcoming legislative session, which begins April 12, will be a fiscal session. 

Copy RID