Amendment 1: Streamlining sales tax collection

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BATON ROUGE, La. (BRPROUD) – In less than a month, Louisiana voters will decide on four constitutional amendments. Passing them could mean major changes to sales tax collections, income tax, levee districts and how the legislature fills fiscal gaps.

Amendment 1 looks to streamline sales tax collection:

“Do you support an amendment to authorize the legislature to provide for the streamlined electronic filing, electronic remittance, and the collection of sales and use taxes levied within the state by the State and Local Streamlined Sales and Use Tax Commission and to provide for the funding, duties, and responsibilities of the commission?”

Louisiana is one of few states that collect sales taxes on the local level. Those who support a centralized system believe it would clear up any red tape and make the state a more attractive place to do business.

“Traditionally, there has been a spider web of collectors,” said Stephen Waguespack, President and CEO of the Louisiana Association of Business and Industry. “There are over 55 different collectors in Louisiana. So if you’re a small business it can be very cumbersome, it can be very expensive. All those collectors have different auditors and assessment levels.”

LABI supports Constitutional Amendment 1, stating the current system is too complex. A ‘yes’ vote would create an online filing system to account for state, local, and remote tax collection.

For those against it, there is concern it will take control away from local governments who argue they know their tax system best.

“But that’s going to be the real challenge with this amendment, is how do you have a uniform system that protects local governments, their ability to retain the money they are owed from sales tax collection, but also make it easier for businesses,” said Davante Lewis, Director of Public Affairs for LA Budget Project.

If the amendment passes, it would create an appointed, eight-member commission. 

“There are four appointees by the state and four appointees by local collectors and so it’s a balanced approach,” Waguespack said. “If it passes, next session, there will be a statutory bill passed to put the rules and regulation around it.”

The LA Budget Project has not taken an official stance on the amendment.

“Currently we do not have any clue who this commission will be and how it will operate because the governing legislation has not been passed yet,” Lewis said. “We are a little bit concerned with that.”

One key note about this amendment is it will not change tax rates. The rates and exemptions would still apply by jurisdiction. Only the way they are collected would change.

The election takes place on Nov. 13. 

Read LABI’s perspective on the amendments here.

Read LA Budget Project’s guide to the amendments here.

Read a nonpartisan guide by the Public Affairs Research Council here.

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