Effort to centralize La. sales tax collection continues

Voters narrowly rejected a constitutional amendment ballot question that would have streamlined Louisiana’s decentralized sales tax system, but lawmakers and business groups are looking to continue the tax reform effort.
“Though Amendment 1 did not pass last Saturday, many of us believe it would have helped make Louisiana more competitive in the business arena,” House Speaker Clay Schexnayder, R-Gonzales, said.
Schexnayder sponsored an overwhelmingly supported legislative bill that led to Amendment 1 appearing on the statewide ballot during the recent fall election. Voters declined the proposal 52%-48%.
Schexnayder said afterward in an interview with the Baton Rouge-based Louisiana Radio Network the outcome was “disappointing.”
“We’ll take a look at it and see what we can get done on our side and, hopefully, take another run at it and get it through this time,” Schexnayder said.
Amendment 1 would have created a central sales tax authority and consolidated Louisiana’s network of 54 different local sales tax collection and remittance entities.
Business groups said approval would have simplified the patchwork sales tax system and allowed for small businesses to be more competitive. Opposing local governments argued the amendment would have undermined local control of sales tax revenue.
Dawn McVea, state director for the National Federation of Independent Business (NFIB), said centralizing sales taxes would help businesses compete with large, “big-box retailers.”
“The only way to capture all the revenue due to the state and local governments via online sales tax collection and, thereby, potentially reduce our highest-in-the-country sales tax rate is to move to a centralized tax collection,” McVea said. “We look forward to supporting a renewed effort to pass the legislation and amendment in 2022.”
McVea blamed the amendment’s failure on low voter turnout — 13.7% according to unofficial results — and opposition from local officials, particularly Orleans Parish.
New Orleans Mayor LaToya Cantrell said the ballot measure was an attempted power grab that would have allowed state leaders to withhold tax revenues currently levied, collected and distributed by the city.
Cantrell cited events at the Louisiana Bond Commission, where financing for the Superdome’s $450 million renovation plan has been delayed, as evidence for keeping local control.
“We cannot afford to let politicians who have no ties to New Orleans make decisions that affect our future without our input or guidance,” she said in October.
According to the Public Affairs Research Council, a nonpartisan policy review organization, Amendment 1 would have included state and local representatives on the planned centralized sales tax commission, which Gov. John Bel Edwards supported.