Just in time for the holidays, the U.S. Supreme Court has refused to hear a case out of New York involving a law that was passed by state legislators there requiring online retailers to collect sales taxes for internet purchases.
While the decision is more than a stone’s throw away from Louisiana, parish level officials were buzzing earlier this month about the tax money to be had, exchanging emails with links to different stories and discussing what the state Legislature needs to do.
“I believe this really opens up some new possibilities for our state and our parishes,” said one longtime lawmaker. “I’ve already been contacted by my parish president.”
So how much does Louisiana lose by not being able to collect online sales taxes? The National Conference of State Legislatures estimates $800 million of sales tax revenue annually in Louisiana is not collected and remitted by internet vendors. Another study by the University of Tennessee found that Louisiana probably lost out on closer to $440 million in online sales taxes in 2012.
Up until now, even Gov. Bobby Jindal was saying that forcing online retailers to collect sales taxes and remit them back to states and their counties/parishes was something Congress had to do. But this new move, or lack thereof, by the Supremes changes the dynamics of the debate. The U.S. Senate has passed a bill addressing online sales taxes, but it’s probably stalled in the House.
The Louisiana Legislature, meanwhile, can’t vote on tax proposals in an even-numbered year, so such a proposal would have to wait until 2015. Or Jindal could call a special session if the issue heats up and increased revenues look more likely.
“This is a game changer and could be worth it for all that money,” a lawmaker told LaPolitics. “But it’s probably not likely.”