Trials

Sale

"Sale" means any transfer of title or possession or both, exchange, barter, conditional or otherwise, in any manner or by any means whatsoever of tangible personal property for a consideration and includes the fabrication of tangible personal property for consumers who furnish, either directly or indirectly, the materials used in fabrication work, and the furnishing, preparing or serving, for a consideration, of any tangible personal property consumed on the premises of the person furnishing, preparing or serving such tangible personal property. A transaction whereby the possession of property is transferred, but the seller retains title as security for the payment of the price, shall be deemed a sale.

Dental devices/ Dentist/ Orthodontic Devices/ Orthodontics/ Prosthetic Device/ Restorative material/

Orthodontic devices, prosthetic devices, prosthesis and restorative materials utilized by or prescribed by dentists in connection with health care treatment, or for personal consumption or use, and any and all dental devices used exclusively by the patient or administered exclusively to the patient by a dentist or dental hygienist in connection with dental or health care treatment are exempt from sales and use tax. However, purchases of dental equipment, office equipment, office supplies, chairs, computers, etc., by the dentist are subject to sales and use tax.

Tire Repair/ Vulcanizing

Persons engaged in repairing and vulcanizing tires and tubes and retreading tires are performing taxable services.

Signs

Persons engaged in the business of painting signs on buildings or other real property belonging to others are rendering nontaxable services. Sales of paint, brushes and other tangible personal property to such sign painters are taxable retail sales. When a sign painter fabricates and paints a sign and sells it to the customer as a finished article, the transaction is a taxable retail sale. Sales of electric, neon, or other illuminated signs, whether manufactured by the seller or not, are taxable retail signs. Signs that are manufactured and installed by the same person or business are treated as real property construction contracts and tax is due only on the materials used. Revenue ruling 07-004 discusses changes to the State of Louisiana's position on what is considered immovable property.

Credit Sales/ Installment Sales

Persons making credit sales or installment sales must report the total sales price on any such sales. The sales tax must be remitted on such total in the monthly tax report due for the month in which the contracts of sales are entered into. Sales taxes are due on an accrual basis, not a cash basis for sales tax reporting purposes.

Political Subdivision

Political Subdivisions are not included under the definition of "person". They are exempt from sales/use tax levied by this state or any political subdivision of this state. AG 10-0019

Long Distance Calling Cards/ Phone cards

Prepaid telephone card sales are considered a sale of non taxable services. Retailers should not collect tax on these sales. Effective January 1, 2010, a 2% 911 service charge is required to be charged and remitted to the state.

Prepaid Calling Cards

Prepaid telephone card sales are considered a sale of non taxable services. Retailers should not collect tax on these sales. Effective January 1, 2010, a 2% 911 service charge is required to be charged and remitted to the state.

Sewage Treatment/ Wastewater Treatment Facilities/

Private companies with contracts to construct AND operate a sewage or wastewater treatment facility for a local government authority shall be entitled to the same exclusion and exemptions as the governmental entity.

Swim Clubs

Private swim clubs do not qualify for a sales tax exemption as a nonprofit civic organization; therefore, membership dues are taxable. The State of Louisiana also taxes private swim clubs fully at 4%.

Lottery/ Louisiana Lottery

Purchases by the Louisiana Lottery Corporation are not subject to local sales and use taxes. Lottery ticket sales are not subject to tax.

Port Authority/ Port Commission

Purchases made by port commissions, which are political subdivisions of the state, are not subject to sales/use tax.

Fire Departments/ Volunteer Fire Dept.

Purchases of equipment used in fire fighting by a bona fide volunteer fire department are not subject to sales and use tax. This became effective July 1, 1992. State regulations explain the exemption does not apply to items intended solely for entertainment, recreation, food or services provided to these fire departments.

Free Gifts with Purchase/ Giveaways/ Premiums and Gifts/ Gifts/ Promotional Items

Purchases of goods to be given away as premiums or gifts, through promotion of products or otherwise, are taxable.

Employee Meals/ Food/Meals

Sales of meals by hotels, restaurants, drive-ins, drugstores, private clubs and establishments not specifically exempted under the UTC, are subject to tax. This is true whether individual meals are sold, whether a flat charge is made, or whether meals are furnished as a part of the compensation for services rendered. When employers, such as restaurants, furnish meals to employees as a part of the compensation for services of such employees, but make no specific charge for the meals, the tax shall be calculated upon the cost price of such meals. If the employer charges employees a discounted price for the meals, sales or use tax would be due on the higher of the cost price of the food or the discounted selling price of the meals. Sales of food to hotels, restaurants and others are sales for resale and are not subject to tax. Meals provided by the owner of drilling barges for the benefit of its customers were subject to Louisiana sales tax and were ineligible for exclusion from the tax as an occasional sale. (See R&B Falcon)

Resale

All sales are considered taxable retail sales unless the seller takes from the buyer a valid resale certificate, signed by and bearing the name, address and registration number of the buyer to the effect that the property is purchased for resale. (Tax Facts July 1997) Sales for resale of repair services: Normally repair services are taxed where the repair service is performed, even if the property is delivered into another taxing jurisdiction. The exception to this is when the repair is for resale. (Tax Facts April 1997)

Manufactured Home/ Mobile Home/ Modular Buildings/ Movable Buildings

All sales of mobile homes that are not permanently attached to real property are taxable when sold by a dealer or by an individual. The state and local sales tax due on each sale is paid to the Department of Public Safety Motor Vehicle Office at the time application is made for a title of the mobile home. The owner of a mobile home may have it declared immovable in the parish records by performing the following procedures within on or before the twentieth day of the month following the month of delivery of the mobile home (HB 1043 Act 272 1997 reg Session): 1. Record an authentic act or executed sale or mortgage describing the mobile home and the land on which it is placed; AND 2. Make a declaration that the home will remain permanently attached to the land described. Before these steps are completed the mobile home is considered movable property. Once the mobile home is declared immovable, all future sales of the mobile home are exempt from sales tax. The exception to this is if the mobile home is later sold without the land. If a mobile home dealer removes a mobile home from his sales facility and places it on a tract of land that the dealer owns, declares the home immovable, and offers both the land and the home for sale as a single immovable, the dealer incurs a use tax liability based on the cost price of the home. The use tax due on this type of transaction should be paid to the Motor Vehicle Office. RR 07-009 Phase in exemption on initial sale of manufactured homes from a dealer to a customer for residential use. Effective January 1, 2006, 46% of the sales price will be considered tangible personal property. Manufactured or mobile homes purchased in or delivered from another state to Louisiana after June 30, 2001, are excluded from the definition of tangible personal property for state sales or use taxes. Manufactured or mobile homes purchased in or delivered from another state to Louisiana after December 31, 2002, are excluded from the definition of tangible personal property for local sales or use taxes when the buyer certifies the manufactured or mobile home will be used as a residence. i. For state sales taxes, the entire price paid for used manufactured or mobile homes and 54 percent of the price paid for new manufactured or mobile homes are excluded from the definition of tangible personal property and not subject to tax. ii. For local sales taxes when buyer certifies the manufactured or mobile home will be used as a residence: (a) after December 31, 2002, and before January 1, 2004 ---25 percent of the price paid for used manufactured or mobile homes and 13 1/2 percent of the price paid for new manufactured or mobile homes are excluded from the definition of tangible personal property and not subject to tax; (b) after December 31, 2003, and before January 1, 2005 --- 50 percent of the price paid for used manufactured or mobile homes and 27 percent of the price paid for new manufactured or mobile homes are excluded from the definition of tangible personal property and not subject to tax; (c ) after December 31, 2004, and before January 1, 2006, --- 75 percent of the price paid for used manufactured or mobile homes and 40 1/2 percent of the price paid for new manufactured or mobile homes are excluded from the definition of tangible personal property and not subject to tax; (d) after December 31, 2005 ---- the entire price paid for used manufactured or mobile homes and 54 percent of the price paid for new manufactured or mobile homes are excluded from the definition of tangible personal property and not subject to tax. iii. Manufactured or mobile homes are structures that are transportable in one or more sections, built on a permanent chassis, designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and include plumbing, heating, air-conditioning, and electrical systems. The units must be either 8 body feet or more in width or 40 body feet or more in length in the traveling mode, or at least 320 square feet when erected on site. These size requirements may be disregarded if the manufacturer voluntarily certifies to the distributor or dealer at the time of delivery that the structure conforms to all applicable federal construction and safety standards for manufactured homes. iv. Manufactured or mobile homes do not include modular homes that are not built on a chassis, self-propelled recreational vehicles, or travel trailers. 32:707(A) extends the time to register mobile homes to apply for a title certificate. Amended by HB 1043, Act 272 of 1997 Reg. Session Act 500 of the 2009 Reg. Session expands the sales and use tax exclusion for manufactured homes to include factory built homes that are used as residences. Effective 1/1/10, the tax on the specified portion of the sales price of new factory built homes are to be paid to the Office of Motor Vehicles by the 20th day of the month after the month of delivery of the home to the consumer. MODULAR BUILDINGS: Modular Buildings are TPP per Bridges vs National Fin. Systems

Gratuities/ Tips/ Waiters

Any gratuity that is automatically added to a customer's bill for a meal, banquet, or private party that is distributed to the waiters is considered a mandatory gratuity. A mandatory gratuity is not considered part of the sales price, and is not taxable. If a mandatory gratuity is collected to supplement labor cost or retained by the seller, then the gratuity is considered part of the sales price and subject to tax.

Refinishers

Automobile refinishers, automobile painters and automobile repair shops are furnishing repairs to tangible personal property. The entire amount charged for such services, including any charge for materials, parts used and labor is subject to tax. Materials and parts purchased by such businesses which will become a part of the automobiles refinished, repaired or painted can be purchased with resale exemption certificates.

Billing Services

Billing services are not subject to sales taxes. Any purchases made by a billing services for its own use and or consumption are subject to sales/use tax.

Taxidermy

Charges for taxidermy services are not taxable. The taxidermy business must pay a tax on the materials used in mounting trophies (i.e. paint, stuffing material, glass eyes, etc.) and consider the taxes paid as a cost factor in determining the price to be charged for the service.

Demobilization Charges/ Installation Charge/

Charges for the installation of tangible personal property, when separately stated on the invoice, are not subject to sales tax. Failure to segregate these installation charges will subject the entire amount to the tax. Charges for installing replacement parts and components onto tangible personal property will continue to be taxable "repairs" under R.S. 47:301(14)(g), even if the charge is invoiced separately and termed "installation." Repair installations are taxable transactions, whether the customer or the repair dealer furnishes the replacement parts. In determining whether a transaction can be characterized as a taxable repair or an excludable installation, the deciding factor will be the reason for which the installation/repair is being performed. If the service is performed to replace a dysfunctional part or component in order to restore the base property to useful service, then the service is a repair. If the property is functional and fully capable of providing useful service, but one or more components is being replaced merely to obtain more desirable features, then the service is a genuine installation performed in conjunction with a sale, and is excludable. © 2010 Thomson Reuters/RIA. All rights reserved.

Home Health Agency/ Nursing Home

Nursing homes are responsible for paying or accruing sales/use tax on supplies and equipment used in its operations. Any meals sold to other persons (i.e., visitors) would be taxable. Home Health Agency - Provide non-taxable service to their patients, based on the orders of a Physician. However, they are consumers or users of all tangible personal property purchased for use or consumption in connection with the operation of the agency and such tangible personal property to them are taxable.

DEQ Tire Waste Fee/ Tire Waste Fee

On January 20, 1992, retail dealers of new tires began adding a $2.00 waste tire disposal fee to the selling price of each new tire they sell. This fee should not be included as part of the selling price for sales tax purposes. (SEE ALSO TRIALS TOPIC "FEDERAL EXCISE TAX")

Crane with Operator/Compressor/ Board Roads/ Collision Damage Waiver/ Gas Compression Equipment/ Gross Proceeds/ Lease Cash Basis Reporting/ Lease for Re-lease/ Leases/ Motor Vehicle Rental/Oilfield Equipment/ Phase-Out/ Portable Toilet/ Rail Road Rolling Stock/ Rent/ Rent-to-own/ Rental with operator/ Scaffolding/ Shipping Containers/ Trash Containers/ Video Bingo

See Car Rental for info on vehicles Lease or Rental means the leasing or renting of tangible personal property and the possession or use thereof by the lessee or renter, for a consideration, without transfer of the title of such property. The term lease or rental, however, shall not mean or include the lease or rental made for the purposes of re-lease or re-rental of casing tools and pipe, drill pipe, compressors, tanks, pumps, power units, other drilling or related equipment used in connection with the operating, drilling, completion or re-working of oil, gas, sulphur or other mineral wells; however, the re-lease or re-rental to the final user is not exempt. The term lease or rental shall not mean or include a lease or rental of property to be used in performance of a contract with the federal government for construction or overhaul of property owned by the federal government, nor the lease or rental of airplanes or airplane equipment by a commuter airline domiciled in Louisiana. Lease or rental shall not include the lease or rental of a crane or a dozer with an operator. GROSS PROCEEDS The total charge "gross proceeds" for the lease is taxable. 47:306(A)(2) establishes that cash basis reporting should be used for lease/rental sales tax reporting and remittance. Separate charges for property tax, administrative charge, restocking charge, etc. are still considered taxable (they are pass-through charges, which become part of the selling price). 47:301(7)(j)(i) Exception: Separate charges for delivery to lessee is not taxable to the lessee. COLLISION DAMAGE WAIVER: Collision Damage Waiver is properly includable as part of the gross proceeds derived from the lease or rental of an automobile because the CDW necessarily arises from the lease or rental of the automobile, can only be contracted for with the lessor of the automobile, and the language of La. Rev. Stat. 22:2091.10 expresses a clear legislative intent that CDW is subject to taxation. The lease or rental of tangible personal property constitutes a taxable sale of services. When determining where the lease or rental tax is due the following criteria should be used: A. For the purpose of local sales or use tax levied upon the lease or rental of tangible personal property, the tax for the initial lease or rental period is due to the local taxing jurisdiction where the transfer of possession of the leased property occurs. B. For subsequent lease or rental periods, when there is no additional transfer of possession, the tax is due to the local taxing jurisdiction where the property is primarily located. The primary location of the property is that location designated by the lessee and made known to the lessor from records maintained in the ordinary course of business. C. Possession or use of the leased property in a local taxing jurisdiction where the property is not primarily located will subject the lessee to the taxes imposed by that local taxing jurisdiction. However, a credit will be allowed for the lease period for any tax previously paid to another local taxing authority under the provisions of paragraphs A or B listed above. It is the lessee's responsibility to report any additional tax due. Effective July 1, 2002, the purchase of tangible personal property to be used for lease or rental purposes is fully exempt from local sales tax per the four year phase in of this exemption. SEE TRIALS TOPIC "USE / USE TAX" FOR PHASE IN INFORMATION ON THE EXEMPTION FOR TANGIBLE PERSONAL PROPERTY PURCHASED FOR LEASE OR RENTAL. RENT-TO-OWN There is a special exception for "rent-to-own" businesses that rent and/or sell furniture, appliances and electronic equipment for the home. See LA R.S. 9:3351 through 3362. This law makes rent-to-own transactions sales and not leases. Collision Damage Waivers paid by the customer and the proceeds are retained by the rental car agency(self insured), are considered part of the gross proceeds and subject to tax. PORTABLE TOILETS Effective January 1, 2007, the furnishing of temporary portable toilet facilities is taxable as a lease or rental of tangible personal property. The taxable base includes any charges for cleaning and servicing. Separately stated delivery and pick up charges are not taxable. BINGO DABBER DEVICES AND BINGO SOFTWARE When a Distributor rent/leases video bingo equipment and the software to a Charity who in turns re-leases the equipment and software to a player, both transactions are taxable rental/leases. Applies to both State and Local (RR 08-009 & RR 08-010) SCAFFOLDING Scaffolding is designed to be used temporarily at multiple locations and is "tangible personal property" under this definition. Transactions for the furnishing of the possession or use of scaffolding, without the transfer of title, will be taxed as leases or rentals. Scaffolding is a type of property that, when set in place, does not require operation by human presence. The customer's possession and use of the scaffolding is the essence of the transactions, and is certainly not an inconsequential element of a service transaction. Applies to State & Local (RR 07-005) SHIPPING CONTAINERS: Firestone vs Calcasieu- Tax was due on shipping containers that were reused by Firestone. MODULAR BUILDINGS: Modular buildings are TPP per Bridges vs National Financial Systems.

Welding

Welding metal parts, pipes, etc. can be treated as a fabrication or a repair. When treated as a fabrication, the labor and materials used in the job are considered taxable as a retail sale. When treated as a repair, welding labor and materials would be taxable if the repair is made to movable property. If a welding repair is performed on immovable property, then only the cost of the material used would be considered taxable to the welder as the final customer.

Telegrams/Western Union

Western Union telegrams are not taxable.

Corporate Officer Liability/ Officer Liability/ Personal Liability

When a corporation fails to file sales/use tax returns or to remit the sales and use taxes collected or invoiced from the purchasers or consumers, the corporate officers and directors may be liable as set forth under Louisiana revised statute

Employee Sales

When a dealer sells tangible personal property to his employees for use or consumption, such sales must be included in his gross taxable sales and the tax on each such sale shall be collected.

Finance Companies

When a finance company sells property that was repossessed from a purchaser to meet the purchaser's obligation, the sale is subject to tax. When finance companies acquire title to such tangible personal property and engage in the business of selling and/or renting such property, the sales or rentals thereof are taxable.

Fabrication

When a person or a business fabricates materials into tangible personal property, the entire charge to the customer (materials and labor), is included in the sales price. It makes no difference if the customer provides the materials, the fabrication labor is still taxable. Examples of fabrications are: portable buildings, signs, storage tanks, etc. When a contract for the fabrication of tangible personal property that will be permanently installed and become immovable, and if the fabricator is also the installer, then the fabrication contract will be treated as a real property construction contract. Tax is due on the cost price of the materials used; therefore, labor is not taxable. If the fabricator and the installer are different, then the total charge for the fabricated item is taxable (materials and labor) and the separately stated installation charges are not taxable.

Cancer Radiation Therapy/ Radiographic Imaging/

Provides for an exemption from state sales tax on the purchase of radiographic imaging eq. for certain non-profit radiation therapy centers. Applies to state tax only with local option.

Calibration Services/ E. Feliciana Repair Exclusion/Cylinder Repairs/ Diving Services/ Estimates for Repair/ Inspection Charges/ Instrument Tuning/ Musical Instrument tuning/ Piano Tuning/ Refurbishment/ Repair/ Repair Delivered Out of State/ Repairs Shipped Offshore/ Repairs to Immovable Property/ Repairs to Movable Property/Roustabout Services

Repairs to tangible personal property are included in the definition of sales of services, and all charges (parts, labor, travel, etc.) for such repairs are taxable as sales of service. REPAIRS E. FELICIANA PARISH 301.14. (g)(i)(bb) Solely For purposes of the sales and use tax levied by the state and by tax authorities in parishes with a population between twenty-one thousand three hundred and twenty-one thousand four hundred and fifty according to the most recent federal decennial census, charges for the furnishing of repairs to tangible personal property may be excluded from sales of services, as defined in this Subparagraph, when the repaired property is delivered to the customer in another state either by common carrier or the repair dealer's own vehicle, however, as to aircraft, delivery may be by the best available means. This exclusion shall not apply to sales and use taxes levied by any other parish, municipality or school board. However, any other parish, municipality or school board may apply the exclusion as defined in this Subparagraph to sales or use taxes levied by any such parish, municipality, or school board. Offshore areas shall not be considered another state for the purpose of this Subparagraph. APPLIES TO STATE AND E. FELICIANA WITH LOCAL OPTION. Act 173 2007 Regular Session INSPECTION CHARGES Inspection charges and repair estimates are not taxable unless the associated repair is actually performed. When the repair is performed as the result of the inspection or the estimate, then estimates and inspection charges become part of the repair and are considered taxable. REPAIRS TO MOVABLE PROPERTY Property classified as movable is defined as tangible personal property that is movable which may be seen, weighed, felt or touched, or which is in any other manner perceptible to the senses. All repairs to movable property performed within a given jurisdiction are taxable, including parts and labor. The transaction is taxable without regard to the final destination of the property. Exception: An optional exemption exists for local taxing jurisdictions that will allow a repair performed in the jurisdiction and then delivered out of state to be excluded from the repair tax. Very few local governments allow this. 47:301(14(g)(i)(bb) If the repair is performed outside of jurisdiction A, and the movable property is to be used within jurisdiction A, tax is due to jurisdiction A only if jurisdiction B (where the repair was performed) has a lower rate than jurisdiction A. In this situation, the tax due to jurisdiction A is limited to the difference between the two rates. Parts purchased by the repair person, to be used in taxable repairs of movable property, may be purchased exempt from taxes with a valid resale certificate. REPAIRS TO IMMOVABLE PROPERTY Immovable property includes items which cannot be removed without substantial damage to the item or property. This includes buildings and its component parts such as plumbing, heating, air conditioning and electrical equipment. All parts and materials used for the repair of immovable property, which is located within a given jurisdiction, are subject the local sales taxes. There are two methods for determining the tax liability on these parts. The repair person may pay the tax due upon their purchase, or purchase the part exempt from tax and charge the customer for the tax. Whichever method is selected by the repair person, it must be applied consistently to all of its customers. If the immovable property is removed from the premises of the customer for repair, the property is deemed movable and treated as the repair of movable property. Calibration checks performed on sensitive instrumentation is not taxable as a repair unless the equipment is actually in need of physical repair or adjustment. Heating and air contractors are liable for sales/use tax on the purchase price of parts they use to repair their customers' systems. Contractors are not liable for the collection of sales tax on the retail price at which the parts were sold to customers as part of the service performed. (Juneau v. Caddo) COMPUTER HARDWARE REPAIRS If computer hardware is broken, all charges for the repair (including installation charges for software) are taxable. The tuning of a piano and other musical instruments are considered a repair to tangible personal property.

Administrative/Agency Agreement/ Assessment/ Authority to Sign/ Constitutional/ Legal Stuff/ Payment Under Protest/ Rule to Cease/ Seizure of Account/

Sales Tax Administrative Court Cases Administrative law and procedure, Garnishment-J. Michael Price and Pamela Price v. Sec., Dept of Revenue Taxation, State of LA Agency Agreement/End Use responsible for taxes-Amberg Alternative remedies for the collection of taxes, Personal liability of LLC members and managers-Herbert W. Way v. Andries Assessment, payment, and enforcement, Levy and assessment, Payment under protest-Portal Boat Company v. Stephens Claims against the State-Sperry Rand Corporation v. Sec. the Dept of Revenue Taxation, State of Louisiana Collection and enforcement against persons or personal property, Summary remedies and actions-St. John the Baptist Parish School Board v. Planters Bancshares, Inc Collection by summary court proceeding authorized-Strain v. Almerico Consumption, distribution and storage, Interstate commerce-Tigator Inc v. PJ of West Baton Rouge Parish Corporate officer liability-State of Louisiana v. John E. Dejeus, Russel J. Moran, and Marcel M. Lashover Court appointed experts, Penalties, Prescription, Court costs-Lafayette Parish School Board v. C & B Sales & Service, Inc Credit for taxes paid-Vermilion Parish School Board v. Weaver Exploration Company Dealers, Industrial Development Boards, Delinquency, Proposed assessment-West Feliciana Parish School Board v. Gulf States Utilities Company Determine validity of tax assessment-D A Construction District Court jurisdiction over Board of Tax Appeals rulings, Proper issuance of a Preliminary inj-G. Vaughn Walton v. McNamara, Secretary, Dept of Revenue Taxation Erroneous advice by state employee, Penalty, Estoppel-St. Pierre's Fabrication and Welding inc., v. Shirley McNamara, Dept of Revenue and Taxation Excess tax collected, Vendor's compensation-Schwegmann Bros. Giant Super Markets, Inc v. Ashton J. Mouton, Collector of Revenue, State of LA Exclusion and exemptions, Constitutional issues-LA Municipal Assoc and the Parish of East Baton Rouge v. St of La and Murphy J Filing of Fraudulent Tax Returns/Interest, Penalty, Attorney Fees-Elevating Boats v. St. Bernard Formal assessment, Rule for taxes, Suit for taxes, Payment under Protest-St. Charles Parish School Board v. Louisiana Power & Light and Combustion Engineering Co. Hotel Motel Occupancy Tax-Gallaspy v. Washington Parish Police Jury Imports and exports, Commencement and continuation of export status-Jose Martin Ortiz, T/A Latin American Distributors v. E, Lee Agerton, Collector of Revenue, State of LA Installation charges, Retail sale, Advance sales tax-McNamara, Dept of Rev, State of LA v. Oilfield Construction Co. Interparish credit, use, consumption, distribution and storage-Terrebonne Parish and Use Tax Dept. v. Callais Cablevision, Inc Judicial Powers and Functions, Encroachment on Legislature-Mouledoux et al. v. Maestri, Mayor et al. Lease or Sale, Res judicata, Deficiency judgment-Howard Trucking Company Inc v. Local payment under protest/taxpayers remedies-Kean's v. Parish of East Baton Rouge Merchants rights to a refund on taxes collected and remitted in error-Krauss Co Limited v. Robert Devi Obligation to remit taxes collected, Use tax transaction defined-Sabine Pine and Supply Co. v. McNamar, Dept of Revenue Taxation Payment under protest-L.A. Frey & Sons v. Lafayette Parish School Board Payment and refunding or recovery of tax paid, Actions and proceedings for recovery of taxes paid-Ortlieb Press, Inc v. Ashton J. Mouton, Collector of Revenue Prescriptive period of taxes, Res judicata-Secretary of the Dept of Revenue Taxation v. Oliver H. Van Horn Co., Inc Property purchased for use out of state-International Export Packers Recovery of taxes paid under protest, Venue-Willie H. Perry and Marcelle W. Perry d/b/a Perry's Store v. State of LA Reliance on state advice, Component parts of vessels-Showboat Star Partnership, Showboat of Louisiana, Inc. and Lake Pontchartrain v. Ralph Slaughter Relief for the payment of illegal taxes, Concursus Proceeding-Quintana Petroleum Corporation v. Parish of Iberville Resale Exemption Certificate-Lake Providence Dredging Co., Inc. v. Collector of Revenue, State of LA Sales taxes collected, not remitted-McNamara, Dept of Revenue, State of LA v. Ventech Equip Seizing Taxpayer Bank Accounts-Court Club Inc v. McNamara Seller liability-Southland Oil Company v. Jenkins Brothers Asphalt Company, Inc Services incidental to the sale of tangible property, Services that are separately stated-Lake Charles Memorial Hospital v. Parish of Calcasieu Parish School Board Statute authorizing municipality to levy and collect taxes-C.P. Litter v. City of Baton Rouge Successor liability-St. Landry Parish School Board v. Acadiana Tire Shop Tax assessment-Lowe's Home Center, Inc. v. Kennedy, Dept of Revenue, State of LA Tax exemptions on lease payments, State Board of Tax Appeals right to waive penalties-Saia Electric, Inc. v. McNamara, Secretary Dept of Revenue Taxation, State of LA Tax liability, Exemptions, Persons subject to or liable for tax-New Orleans Summer Pops, Incorporated v. Tregle, Collector of Revenue, State of LA Ticket sales by a musical jamboree-East Baton Rouge v. Kosay Enter Venue-Nick Putch et al Plantiffs-Appelles v. Collector of Revenue, State of LA, Defendant Willful failure to collect or truthfully account for or pay over state sales tax-State of Louisiana v. Main Motors, Inc Willful failure to pay sales tax-State of Louisiana v. Julie Neumeyer Court ruled Parish of Iberville could increase the tax. Tax collected above the 5%. Crosby's Furniture vs ST Tammany, affidavit must be properly signed and worded by Taxing Authority in order to be valid.

Blind Persons/Sales Made by the Blind

Sales and purchases made by a seller who is blind may not be taxable if the seller conducts a business exempt from license taxes in accordance with RS 23:3032. Businesses exempt from license taxes imposed by these provisions are those operating in state and local governmental buildings. (APPLIES TO STATE AND LOCAL TAX) Organizations that provide training for the blind and receive at least 75% of the organizations funding from public funds are allowed to purchase goods and services free of the general sales/use tax.

Blast Furnaces/Electricity/ Compressor-Natural Gas/Chlor-Alkali Process/ Iron Production/ Natural Gas/ Natural Gas Storage Service/ Steelworks Utilities/ Water Residential Sales/

Sales of electricity and natural gas are exempt from local sales and use tax. Local governments may assess a public utilities (franchise) tax on these sales up to 5%. APPLIES TO STATE TAX ONLY: Purchases of electric and natural gas by paper or wood products manufacturing facilities are exempt from State sales tax. 47:301(3)(j) and (13)(i), 302(T), 321(J), and 331(R) Natural gas used in the production of Iron. 47:301(10)(c)(i)(bb) Electricity used for the Chlor-Alkali manufacturing process is exempt from the general sales tax. 47:301(10)(c)(ii)(aa) Sales of water to the consumer for residential use. La. Const. Art.VII sec. 2.2 Utilities used by steelworks and blast furnaces are exempt from sales tax. 47:305.51 Purchase of butane, propane and other liquefied petroleum gas used for private residential cooking and cleaning. 47:305.39 Natural gas held, used, or consumed in providing natural gas services or operating natural gas storage facilities is exempt from the general sales tax. 47:301(10)(z)(bb) Applies to State Only: The use of customer-supplied natural gas by a gas transmission company to power its compressors used in its natural gas pipeline system constitutes a sale for Louisiana sales tax purposes.

Car Dealer Tag/Labels/ Nameplates

Sales of labels, nameplates or tags to a manufacturer who affixes them to products manufactured by him constitutes sales for resale if such is required on the product being sold. If someone orders labels, nameplates, or tags for their own use, the tax is due in the form of a sales or use tax. Car dealership advertising tags, stickers, etc., are taxable to the car dealership.

Building Supplies/ Material Sales/ Supplies

Sales of materials and supplies to persons and contractors to be used in erecting, altering, improving, or repairing buildings or other improvements are sales to consumers and not sales for resale and are taxable. The seller of such materials must collect and remit the tax.

Component Parts/ Further Processing/ Ingredient/ Parts for Further Processing/ Raw Materials

Sales of materials for the primary purpose of further processing into articles of tangible personal property for subsequent sale at retail do not constitute retail sales.

Art District/ Art Objects/ Artist/ Canvas/ Cultural Product District/Paintings

Sales of objects of art are sales of tangible personal property and are taxable. Sales and use taxes imposed by the State and any of its political subdivisions shall not apply to the sale of original, one of a kind works of art from an established location within the boundaries of a cultural product district

Acetylene/Butane/ Hydrogen/ Laughing Gas/ Nitrous Oxide/ Oxygen/ Propane

Sales of oxygen, acetylene, hydrogen, and liquefied gas (butane, propane, etc.) to manufacturers, processors, refiners, repairmen, contract welders, dentists, or junk dealers, or for use as fuel or illumination, are sales to consumers or users and are subject to tax. If such products are sold to dealers for resale in their original state or are used as a raw material that is processed further, such sales are not subject to tax. APPLIES TO STATE TAX ONLY: Purchases of fuel or gas by residential customers is exempt from the general sales tax. This includes residential propane and butane. 47:301(10)(x) and 47:305.39 AGO 09-0284 Purchases of propane used in farm grain dryers constitutes materials and Local Taxing Jurisdiction may exclude with local option.

Accredited Educational Institutions/ Educational Institutions Accredited/ Independent Educational Institutions/ School Book Store/ School Books

Sales of school books by persons engaged in the business of selling such books to users or consumers are subject to tax. Some books are exempt after 1996. State and local sales/use tax does not apply to donations made from retail inventory of tangible personal property to a school who meets the definition in R S 17:236 or to a public recognized independent institution of higher education. 47:301 (18)(a)(i) (SEE ALSO TRIALS TOPIC "RELIGIOUS") APPLIES TO STATE TAX ONLY: Purchases by regionally accredited independent educational institutions are exempt from sales, use and lease/rental tax. 47:301(8)(b)

Concrete Truck Standby Charge/ Stand-by Charge

Standby charges made by concrete companies are subject to taxation. A standby charge is a fee assessed for the extraordinary use of the truck or the delay in the use of the truck caused by the customer. Many times the concrete must be discarded because of the delay. Even in this case, the charge is taxable. The State of Louisiana takes the same position.

Charity/Churches/ Carnivals/ Bass Life/ Donated Toys/ Camp Facilities - NonProfit/ Fraternal Organizations/ Fuller Center for Housing/ Goodwill Stores/ Government Agencies/ Habitat for Humanity/ Hands on New Orleans/ Historical Organizations/ Literacy Organizations/Local Government/ Mardi Gras/ Migratory Waterfowl Preservation/ Military Thrift Stores/ Musical Organizations/ Nonprofit/ Nonprofit Corporations/ Nonprofit Events/ Nonprofit Parking/ Nonprofit Retirement Centers/ Performing Arts Nonprofit/ Public Trust/ Publicly Owned Building/Rebuilding Together New Orleans/ Retreat Facilities Nonprofit/ School (Private) / Sheltered Workshops/ Sickle Cell Disease/ State Government/Theatrical Performance Nonprofit/ Thrift Stores/ Toys/

State and local taxing authorities exempt nonprofit organizations from collecting sales tax on sales of tangible personal property, admissions charges, outside gate admissions, and parking fees associated with events sponsored by educational, historical, charitable, fraternal, or religious organizations. The exemption only applies when the entire proceeds, except for the necessary expenses connected with the event, are for educational, charitable, religious, or historical purposes. Note that the nonprofit organization is not exempt from sales and use taxes, but from the collection of sales tax at events such as those described above. A proper exemption certificate must be acquired from the State and the local taxing jurisdiction prior to the event. Nonprofit organizations are not exempt from paying sales tax on their purchases. Sales or use tax should be paid on the purchases of tangible personal property used by the organization. MARDI GRAS: The following exceptions apply: Sales and Use Tax levied by the State of La. shall not apply to the purchases or sales of specialty items for use in connection with Mardi Gras activities by carnival organizations and nonprofit organizations domiciled in Louisiana. This exemption does not apply to local sales tax. 47:305(40)(A) The term "sales price" shall not include the price of specialty items sold to members for fund raising purposes by nonprofit organizations domiciled in Louisiana. This exclusion is effective August 1, 2005. (47:301(13)(1)(I) The October 1991 Tax Topics explained Act 533. Act 533 amends and reenacts R.S. 47:305(14) (A) to relax the criteria for nonprofit organizations to qualify for the fund-raising event exemption by allowing the organization to retain the proceeds of the event to further its own purposes. Act 533 became effective July 15, 1991. (Also see Act 930) Effective September 7, 1990, any youth organization chartered by Congress, such as the Boy Scouts and Girl Scouts are allowed to sell food free of sales tax. 47:301(10)(h) CAMP AND RETREAT FACLITIES Camp and retreat facilities owned and operated by nonprofit organizations exempt from federal income tax under Section 501(c)(3) are exempt from State and local sales tax. If a room rental is associated with the attendance of a function devoted to the nonprofit's purpose then the hotel tax is exempt also. 47:301(6)(b) Admission to places of amusements at camp and retreat facilities are exempt. 47:301(14)(b)(iv) Act 377 (HB 639) 2005 regular session- Purchases by a public trust are exempt from sales/use tax on bulk purchases of materials, supplies, vehicles and equipment. The purchase must be made on behalf of the public trust. The public trust must be organized pursuant to a state law and having its beneficiaries in the State of Louisiana. 38:2212.4 Sales by thrift shops on military installations are exempt from the sales/use tax. 47:305.14 Sales to nonprofit literacy organizations are exempt from sales and use tax. Must be IRS 501(c)(3) and comply with Dodd Brumfield court decision. 47:305.14 Certain gate admissions and parking fees to fairs, festivals and expositions sponsored by Louisiana chartered nonprofit organizations are exempt from sales tax. The exemption does not apply to any event intended to yield a profit to the promoter. 47:305.18 SHELTERED WORKSHOPS Sheltered workshops for the mentally retarded can sell and purchase tax free. The workshop must be used as a day development training center and licensed by the Department of Social Services. 47:305.38 DUCKS UNLIMITED AND BASS LIFE Ducks Unlimited and Bass Life and their chapters can sell, purchase, or rent items free from State and Local sales tax. 47:305.41 Also, related exemption 47:305.43 exempts certain transactions with nonprofit groups whose purpose is to conserve migratory waterfowl and fish. Domestic nonprofit organizations that present dance, drama, or performing arts can sell tickets to performances exempt from sales tax. 47:305.42 HABITAT FOR HUMANITY (Applies to state and local) FULLER CENTER FOR HOUSING (Applies to state and local) HANDS ON NEW ORLEANS (Applies to state and local) REBUILDING TOGETHER NEW ORLEANS (Applies to state and local) Act 430 (HB 241) enacts R.S. 47:305.59* to create a state and local sales/use tax exemption for the sale of construction materials to Habitat for Humanity affiliates located in this state when the materials are intended for use in constructing new residential dwellings in this state. Effective October 1, 2007. Applies to State and Local Tax (See Act) (Tax Topic 10/07) ACT 464 2009 REG SESSION Expands the state and local sales tax exemption for Habitat for Humanity affiliates on their purchases of construction materials intended for use in constructing new residential dwellings to also include purchases of materials made by the Fuller Center for Housing covenant partners, Hands on New Orleans and Rebuilding Together New Orleans. Limits Hands on and Rebuilding purchases to the 1st 500,000 per calendar year. SICKLE CELL DISEASE (Applies to state and local) Act 278 (SB 27) enacts R.S. 47:305.53 and R.S. 47:337.9(D)(27) to provide a state and local sales tax exemption for nonprofit organizations that were established prior to 1975 conducting comprehensive programs on sickle cell disease. The organizations are required to obtain exemption certificates from the Department of Revenue. Effective July 1, 2005. Applies to State and Local (Tax Topic 10/05, State site says 9/05) DONATED TOYS (Applies to state and local) Act 293 (SB 131) enacts R.S. 47:301(10)(y) and (18)(k) to grant an exclusion from state and local sales tax for nonprofit organizations that donate toys to children. The organizations are required to obtain exemption certificates from the Department of Revenue or the tax collector of the political subdivision. Effective July 1, 2005. Applies to State and Local (Tax Topic 10/05, State site says 9/05) ENTITIES THAT SELL DONATED GOODS (THRIFT STORES) APPLIES TO STATE TAX ONLY: Purchases of tangible personal property by nonprofit entities that sell donated goods. 75% of revenues are spent on employing or training persons with disabilities. Applies to thrift stores. 47:301(8)(f)(i) NONPROFIT RETIREMENT CTRS CONSTRUCTION MATERIAL APPLIES TO STATE TAX ONLY: Construction materials and operating supplies purchased by certain nonprofit retirement centers owned and operated by any public trust or incorporated not-for-profit organization. 47:305.33

Compressor Gas Barter/ Trade Ins

TRADE IN: The tax levied by the local taxing ordinances on any transaction in which a part of the sales price is represented by like property traded in shall be calculated on the total sales price less the market value of the like property traded in. At such time as the like property taken in trade is sold, tax shall be collected on the sales price. BARTER: A sale includes, but is not limited to, transactions where payment is made in a form other than money, as in a barter agreement, an exchange of property, or a promissory note. Tax shall be collected on the total sales price. Natural gas received free from customers to run compressors was a barter and subject to use tax. (See State vs Production Op)

Coin Operated Telephones/ Call Centers/ High Speed Internet/ Pager Services/ Pay Phones/ Phone Services/ Telecommunication Services/ Telecommunications/ Telephone Services/ Wireless Phones

Telecommunication services are not subject to local sales and use tax. However, the State of Louisiana does tax this service. Telecommunications services consist of local telephone service, toll telephone service, cellular phone service, digital pager service, and portable radio services. Pager "rentals" with pager service included is not taxable. Use tax is due on pager equipment. Equipment purchases by telecommunication companies are subject to local sales and use tax. Only the charge for communication services are exempt. Internet access fees are not subject to local sales tax. APPLIES TO STATE TAX ONLY: Interstate telecommunications services purchased by defined call centers are exempt from the State sales tax. Applies to $25,000 per year in charges. 47:301(14)(i)(ii)(c) APPLIES TO STATE TAX ONLY: Telecommunication services provided through coin-operated telephones are excluded from State sales tax. 47:301(14)(i)(iii)(aa) APPLIES TO STATE TAX ONLY: Miscellaneous telecommunications services are excluded from State sales tax. 47:301(14)(i)(iii)(bb) and (dd) Act 531 2009 Reg Session imposed service charge on prepaid wireless for 911.

Council on Aging

The Council On Aging is an agency of the State of Louisiana and Parish. It is a tax exempt organization and purchases by the agency are tax exempt.

Cable Television/ Digital Television/ On-Demand Movies/ Pay-Per-View/ Television/ TV

The charges for the installation of and service for cable television are not taxable. However, purchases made by cable television systems of tangible personal property are subject to sales and use tax. An exclusion from state sales tax and a local option for exclusion of "Digital Television Equipment" has been granted by the state legislature. Per RIB 10-015, On-Demand and Pay-Per-View Movies are considered TPP and therefore taxable as a lease/rental. (Temporarily Suspended by RIB 10-028)

Sales Price

"Sales Price" means the total amount for which tangible personal property is sold, less the market value of any article traded in, including any services, except services for financing, that are a part of the sale valued in money, whether paid in money or otherwise, and includes the cost of materials used, labor or service costs, except costs for financing, which shall not exceed the legal interest rate and a service charge not to exceed six percent of the amount financed, and losses; provided that cash discounts allowed and taken on sales shall not be included, nor shall the sales price include the amount charged for labor or services rendered in installing, applying, remodeling or repairing property sold. "Sales Price" shall not include any amount designated as a cash discount or a rebate by the vendor or manufacturer of any new vehicle subject to the motor vehicle license tax. For purposes of this subparagraph "rebate" means any amount offered by a vendor or manufacturer as a deduction from the listed retail price of the vehicle.

Services Taxable/ Taxable Services

"Sales of Services" means and includes the following: 1. The furnishing of sleeping rooms, cottages, or cabins by hotels and tourist camps (EBR Regulation 71) 2. The sale of admissions to places of amusement, to athletic entertainment other than that of schools, colleges and universities, and recreational events, and the furnishing, for dues, fees, or other consideration, of the privilege of access to clubs or the privilege of having access to or the use of amusement, entertainment, athletic or recreational facilities, but the term "sales of services" shall not include membership fees or dues of nonprofit civic organizations, including by way of illustration and not of limitation the Young Men's Christian Association, the Catholic Youth Organization and the Young Women's Christian Association. Places of amusement shall not include museums, which are hereby defined as public or private nonprofit institutions which are organized on a permanent basis for essentially educational or aesthetic purposes and which use professional staff to do all of the following: a. Own or use tangible objects, whether animate or inanimate. b. Care for those objects. c. Exhibit them to the public on a regular basis. Museums include but are not limited to the following institutions: a. Museums relating to art, history, including historic buildings, natural history, science, and technology. b. Aquariums and zoological parks. c. Botanical gardens and arboretums. d. Nature centers e. Planetariums. (EBR Regulation 47) 3. The furnishing of storage or parking privileges by auto hotels and parking lots (EBR Regulation 86) 4. The furnishing of printing or overprinting, lithographic, multilith, blueprinting, Photostatting or other similar services or reproducing written or graphic matter (EBR Regulation 90) 5. The furnishing of laundry, cleaning, pressing and dyeing services, including by way of extension and not of limitation, the cleaning and renovation of clothing, furs, furniture, carpets and rugs, and the furnishing of storage space for clothing, furs, and rugs (EBR Regulations 76 & 106) 6. The furnishing of cold storage space and the furnishing of the service of preparing tangible personal property for cold storage where such service is incidental to the operation of storage facilities (EBR Regulation 59) 7. a. The furnishing of repairs to tangible personal property, including but not restricted to, the repair and servicing of automobiles and other vehicles, electrical and mechanical appliances and equipment, watches, jewelry, refrigerators, radios, pianos, shoes and office appliances and equipment. appliances and equipment. b. For the purpose of this subparagraph, tangible personal property shall include machinery, appliances, and equipment which have been declared immovable by declaration under the provisions of Article 467 of the Louisiana Civil Code and things which have been separated from land, buildings or other constructions permanently attached to the ground or their component parts as defined in article 466 of the Civil Code. (EBR Regulation 41) 8. The lease or rental of tangible personal property constitutes a taxable sale of services. (EBR Regulation 35) The term "Sale of Service" shall not include an action performed pursuant to a contract with the U.S. Department of the Navy for construction of or overhaul of U.S. Naval vessels.

Tangible

"Tangible Personal Property" means personal property which may be seen, weighed, measured, felt or touched, or is in any other manner perceptible to the senses. The term "tangible personal property" shall not include stocks, bonds, notes or other obligations or securities; gold, silver or numismatic coins, or platinum, gold, or silver bullion having a total value of one thousand dollars or more.

Rental Property/ Use/ Use Tax

"Use" means the exercise of any right or power over tangible personal property incident to the ownership thereof, except that it shall not include the sale at retail of that property in the regular course of business. (See state statute for additional exceptions to use tax.) The local ordinances impose a tax on the use or consumption of tangible property that is used within the parish. The use tax does not apply to the use of any property which has been subjected to sales tax in a taxing jurisdiction outside the parish in an amount equal to or greater than the amount of tax imposed by local ordinance nor does the tax apply to the use of any property which is exempt from the tax imposed upon the sales at retail by local ordinance. The 1999 Legislative session enacted Act 1266 which provided an exclusion from local sales and use tax for all tangible personal property purchased for the purpose of being leased or rented. The exclusion is subject to a phase in period as follows: Beginning 7/1/99, one-fourth (1/4) of the sales or cost price is excluded. Beginning 7/1/00, one-half (1/2) of the sales or cost price is excluded. Beginning 7/1/01, three-fourths (3/4) of the sales or cost price is excluded. Beginning 7/1/02, the total sales or cost price is excluded. A properly executed exemption certificate claiming the property is for lease or rental purposes must be provided to the seller or vendor selling such property. This exemption certificate is also valid when purchasing replacement parts only. Any repairs performed on this equipment by a third party repair dealer is subject to the full sales tax rate. Also, any routine maintenance performed on this equipment is subject to the full sales tax rate. Routine maintenance includes items such as oil changes, filter changes, lubricants, etc. Individual (personal) consumer use tax (non business transactions) may be paid on a State of Louisiana Personal (individual) Income Tax Return. See the Louisiana Department of Revenue Website for details. NO USE TAX DUE IF SALES TAX NOT DUE 47:301.(19) "Use tax" includes the use, the consumption, the distribution, and the storage as herein defined. No use tax shall be due to or collected by: (a) The state on tangible personal property used, consumed, distributed, or stored for use or consumption in the state if the sale of such property would have been exempted or excluded from sales tax at the time such property became subject to the taxing jurisdiction of the state. (b) Any political subdivision on tangible personal property used, consumed, distributed, or stored for use or consumption in such political subdivision if the sale of such property would have been exempted or excluded from sales tax at the time such property became subject to the taxing jurisdiction of the political subdivision.

Fitness Clubs

47:303(F) Cash basis sales tax reporting and remitting for health and fitness club membership contracts. Allows health clubs to report and remit sales tax on a cash basis.

Health Clubs

47:303(F) Cash basis sales tax reporting and remitting for health and fitness club membership contracts. Allows health clubs to report and remit sales tax on a cash basis.

Steam

47:305(D)(1)(b) allows for the sale of steam tax free.

Video/Video Production Company/ Videographer

A videographer who merely records certain events such as weddings, seminars, graduations, etc., should charge sales tax on the total amount billed to the customer. L.R.S. 47:302(d) exempts advertising services rendered by an advertising business. Because of this exemption, producers of videos would not be required to collect tax on the sale of videos produced for advertising purposes. A video production company that hires actors, directs, and produces afilm (training, safety, etc.) for an individual or company is performing a non-taxable service. If the film is reproduced and subsequently sold to more than one customer, then these individual sales are taxable.

Domed Stadium/ Cajun Dome/ Publicly Owned Facilities/ River Center/Super Dome

39:467 Allows tax free sales to be made within state-owned domed stadiums with a seating capacity of at least 70,000,or any open baseball site that has seating capacity of at least 10,000 and has a professional sports franchise that participates in Class Triple A professional baseball. R.S. 39:468 Allows tax free sales by certain publicly owned facilities (Cajun Dome) . The local taxing jurisdictions must elect to exempt the sales tax. If they do, the State will exempt also. It is a local option. Act 464 of Reg. Session of 2009 La Legislature expands the domed stadium and baseball facilities exemption under La RS 39:467 to include domed arenas and adjacent and connected facilities meeting certain criteria. Currently limited to facilities in Lafayette and St. Tammany parishes, more specifically the Cajun Dome facility located in Lafayette, La. Applies to State and Local. In Cajundome VS Carl Meche the courts ruled that "Commission is a person and must collect and remit STX"

Helicopters/ Measurement-while-driving/ Offshore Transportation/ Offshore Vessel/ Vessel Used Offshore/

47:305.19 allows vessels leased or rented for use offshore beyond territorial limits for the production of oil, gas, sulphur, and other minerals to be exempt from sales tax. 47:302.1 allows for the lease or rental of helicopters used in the extraction, production or exploration of oil, gas and other minerals to be considered a sale with and extended period of time allowed to remit any tax due. NOTE: Lease rental exemption makes this provision obsolete. 47:301(3)(d)provides for an alternate reporting method for importers and users of certain "measure-while-drilling equipment to store equipment in state without paying taxes upon importation. Instead taxes would be paid on 1/60 of the total material cost of all equipment stored in Louisiana each month. 47:306.1 and 2 allows transportation companies to pay sales tax based on "Louisiana miles"

Vendors Compensation

47:306(A)(3)(a) - The state allows for a 1.1% vendors compensation. The Dealer is allowed to deduct 1.1% of the tax due provided the reports are submitted and paid on a timely basis. 47:337.2(B)(3)(e) - Some local taxing jurisdictions also allow for vendors compensation. These rates vary by taxing jurisdiction.

DP Number

A direct pay number allows the taxpayer to pay all sales and use taxes due on purchases of tangible personal property and taxable services directly to the local taxing jurisdiction. Direct pay numbers cannot be extended to contractors or employees of direct pay taxpayers. Items must be billed directly from the vendor to the direct pay taxpayer for the exemption to apply. Repairs performed outside the taxing jurisdiction that authorized the direct pay status are taxable where the repair occurs. Tangible personal property picked up by the direct pay taxpayer outside the taxing jurisdiction that authorized the direct pay certificate are taxable where picked up.

Direct Pay Permit

A direct pay number allows the taxpayer to pay all sales and use taxes due on purchases of tangible personal property and taxable services directly to the local taxing jurisdiction. Direct pay numbers cannot be extended to contractors or employees of direct pay taxpayers. Items must be billed directly from the vendor to the direct pay taxpayer for the exemption to apply. Repairs performed outside the taxing jurisdiction that authorized the direct pay status are taxable where the repair occurs. Tangible personal property picked up by the direct pay taxpayer outside the taxing jurisdiction that authorized the direct pay certificate are taxable where picked up.

Drop Shipme

A drop shipment is generally a three party transaction in which a retailer sells goods to a buyer and then orders a supplier, wholesaler, or manufacturer to deliver the goods or "drop the shipment" directly to the buyer's customer(s). Unless the property purchased or the final retail customer is exempt from the tax by law, retail customers owe the sales or use tax on the "sales price" or "cost price" of the property that they buy. The retail customer must pay the sales or use tax, either to the vendor or directly to the taxing authorities in which the delivery takes place. The transaction between the manufacturer and the retail customer is not a taxable transaction as there is no sale which occurs between the parties. The actual sale occurs between the Retailer and the ultimate consumer. Whether the retail dealer charges the tax on their invoice largely is dependent upon whether they have nexus in the state and parish in which the tangible personal property is delivered.

Lay-away Sales

A sale whose delivery is conditional on payment of the amount due is not completed until the amount due is received by the seller, therefore it is not taxable until the sale is completed. However, tax is due on the total sales price when the seller delivers the merchandise to the purchaser, regardless of payment terms. The sale is completed when the merchandise is received.

Nexus

A seller must have a minimum connection with the local taxing jurisdiction, which is labeled "nexus", before a local taxing jurisdiction may impose collection duties of the local taxing jurisdiction's sales and use taxes on the seller. A seller has sufficient nexus with the jurisdiction if the seller has a place of business, sales representatives, or an office or warehouse located in the jurisdiction. Local taxing jurisdictions have found nexus to exist where the seller conducted the following activities: regularly made deliveries in his own vehicles in a local taxing jurisdiction; made installation and repairs of goods in a local taxing jurisdiction; utilized the local taxing jurisdiction's court to repossess goods; enjoyed the benefits of a local taxing jurisdiction's services, such as police protection and use of highways, when performing services in a local taxing jurisdiction for the benefit of customers. Courts have ruled that nexus can be established by using a 3rd party vendor to make repairs on materials located in a taxing jurisdiction. (State vs Dell)

Extensions/ Hurricane Katrina/ Hurricane Rita/ Natural Disaster Sales Tax Refund/ Sales Tax Holiday - Hurricanes/Storm Shutter

APPLIES TO STATE SALES TAX ONLY: State Sales tax holiday December 16-18,2005 for businesses located in the Hurricane Rita and Katrina assistance areas. 47:305.54 ANNUAL SALES TAX HOLIDAY (Applies to State only.) Act 429 of the 2007 regular session of the Louisiana Legislature has enacted R.S. 47:305.58 to provide for an annual state sales tax holiday on sales of hurricane-preparedness items or supplies made on the last Saturday and Sunday of each May. During the two-day annual holiday, tax-free purchases are authorized on the first $1,500 of the sales price of each portable self-powered light source; portable self-powered radio, two-way radio, or weather band radio; tarpaulin or other flexible waterproof sheeting; any ground anchor system or tie-down kit; any gas or diesel fuel tank; any package of AAA-cell, AA-cell, C-cell, D-cell, 6-volt, or 9-volt batteries, excluding automobile and boat batteries; any cell phone battery and any cell phone charger; any non-electric food storage cooler; any portable generator used to provide light or communications or preserve food in the event of a power outage; any "storm shutter device", as defined in the Act; any carbon monoxide detector; and any blue ice product. This exemption will not extend to items purchased at any airport, public lodging establishment or hotel, convenience store, or entertainment complex. RIB 07-027 Purchase or rental of machinery and equipment damaged or destroyed by Hurricane Katrina or Rita. 47:305.55 A refund provision gives financial assistance to persons who have suffered uninsured losses in natural disasters. Sales tax paid on destroyed property can be refunded. 47:315.1 STORM SHUTTERS (Applies to state tax only with local option.) Act 462 (SB 37) 2007 Regular Session enacts R.S. 47:301(10)(ee)* and (18)(o) to provide an exclusion from state sales and use tax for shutter devices. This Act also enacts R.S.47:337.10(M)*, which provides that political subdivisions may by ordinance or resolution provide a local sales tax exemption for storm shutter devices. Effective July 1, 2007 (APPLIES TO STATE ONLY WITH LOCAL OPTION.)

Pollution Control Devices

APPLIES TO STATE TAX ONLY: Purchases of pollution control devices and systems are exempt from state sales tax. 47:301(10)(l)

Fencing Temporary/ Lighting at Construction Site

According to the State Dept of Revenue, Revenue Ruling 07-007 dated October 15, 2007 the furnishing of construction barricades; associated lighting equipment, temporary fencing, etc are taxable as leases and rentals. The tax base will include charges for lease/rental, as well as charges for bulb replacement or other maintenance of the property while in service. (APPLIES TO STATE AND LOCAL)

Airport/ Greater Baton Rouge Airport District/ Ryan Airport

All purchases made by the Greater Baton Rouge Airport District are exempt from local sales/use tax.

Reports-Computer

Converting records from a computer or file to a hard copy report is a non-taxable service.

Copy Services/ Medical Records

Copies of medical records made directly by the doctor would be exempt as the work product of a professional. However, if the copies are made by a third party, the service or sale of tpp would not qualify for this exemption and would be taxable. (RR 07-006) APPLIES TO STATE AND LOCAL TAX

Credit for Taxes Paid/ Local Tax Credit for Tax Paid/ Sales Tax Credit for Money Paid

Credit shall be given to taxpayers who paid taxes to other jurisdictions within the state. The Local Taxing Jurisdictions can only assess the difference between the taxes paid and the taxes due. The Local Taxing Jurisdictions cannot assess at a tax rate that will exceed the total state and local tax rate. Credit shall be given when the taxes have been paid to another state when that state offers a similar credit. Credit on boats or other tangible personal property imported into Louisiana from other states shall be granted credit based on tax paid not on the rate of tax paid. For Example: - Boat and motor purchased new for $10,000 in Texas. - Taxpayer paid 5% (state and local)Texas tax ($500). - Boat and motor moved to East Baton Rouge Parish and depreciated value of boat and motor is now $7500. - Taxpayer owes difference between the $7500 *.09 (state and local tax) $675 and the $500 they paid Texas. - The difference is $175 tax owed to EBR Parish.

Reclaimed Property/ Repossessed Merchandise

Dealers who repossess articles of tangible personal property shall not, for local sales tax purposes, deduct from their gross proceeds of sales the unpaid amounts on repossessed merchandise or claim any other deduction with respect to such repossessions.

Demurrage/ Lay-over time/ Retention Time/

Demurrage is an additional amount charged by a vendor for the retention of containers past a specified period of time. Separately stated demurrage charged by the vendor is exempt from taxes, even if the vendor is in the business of renting the containers. Demurrage is usually charged on a separate invoice and must occur after the containers are considered late. Up front charges for demurrage is considered part of the rental fee and fully taxable.

Diesel Fuel/ Gasohol/ Gasoline/Dyed Diesel/Unblended Diesel

Diesel fuel is not taxable. By Article VII, Section 27 of the Constitution of Louisiana, purchases of gasoline, diesel fuel, or special fuels which are subject to excise tax under Chapter 7 of Subtitle II of Title 47 of the Louisiana Revised Statutes shall be exempt from the state sales tax and any sales tax levied by a political subdivision as defined by Article VI, Section 44(2). RS 47:305.37 STATE TAX EXEMPT ONLY: Property used in the manufacture, production, or extraction of unblended diesel per R.S. 47:301(7)(j), (10)(y), and (18)(k) APPLIES TO STATE AND LOCAL TAX: Gasohol sales are exempt when sold in Louisiana. The alcohol used in the gasohol must be produced, fermented, and distilled in Louisiana. per R.S. 47:305.28

DVD Rental/ Tape Rental/Video Tape Rental

Each time the store rents a video or DVD, sales tax is due on the rental. If the store sells used videos or DVDs, sales tax is due on the selling price. Effective July 1, 2002, the purchase of videos or DVDs for rental purposes is fully exempt from local sales tax as per the four year phase in of this exemption. SEE TRIALS TOPIC "USE / USE TAX" FOR PHASE IN INFORMATION ON THE EXEMPTION FOR TANGIBLE PERSONAL PROPERTY PURCHASED FOR LEASE OR RENTAL.

Little Sisters of the Poor

Effective August 15, 1998 The Society of the Little Sisters of the Poor have been removed from the definition of "person". Any purchase, lease/rental of tangible personal property is excluded from the tax. The exemption applies to the organization and not individual members. The Society is however, required to collect sales tax on any sale made by the organization. 47:301(8)(e)

Cross Ties/Railroad Ties/ Car Hire on Freight Cars/ Freight Cars/ Green Ties/ Per Diem/ Piggy-back Trailers/ Rail Cars/ Railroad Ties/ Rolling Stock/ Switch Engines/ Track Mobiles

Effective July 1, 1986, the sales/use and lease tax shall not apply to "per diem" or "car hire" on rolling stock when the rolling stock, or railcars, is owned by another on the tracks of the taxpayer. Repairs made in the parish to railroad rolling stock are subject to sales tax. RAILROAD TIES-GREEN TIES (Applies to state and local taxes) 47:305.50 F. Railroad ties purchased prior to long-term preservation treatment (green ties) and sold in this state to railroads for use on tracks outside the boundaries of the taxing authority are exempt from state and local taxes. However, the application of long-term preservation treatment and sales of treated ties (black ties) by a third party continues to be subject to the state and local sales tax. Effective 7/09 SB 9, Act 442,

Embalmer/ Funeral Homes/ Morticians/ Undertakers

Effective July 1, 2000, charges for funeral directing services should be excluded from sales and use tax. Funeral directing services include management of funerals, supervision of hearses or funeral cars, preparing bodies for burial, and any other act or service connected with the management of funerals. (Act 47) Funeral Directors' services are not taxable; however, anything sold to the public, such as caskets, flowers, etc., are taxable as a sales transaction. The funeral director owes use tax on all materials and supplies used to prepare the body for interment, as well as those items used or consumed in the operation of the business. According to the Attorney General's opinion, the sales tax is due in the taxing jurisdiction where the contract is signed, and not where the body is interred since there is more to the funeral service than simply burying the body. Also, the majority of the service is usually provided where the contract is signed. Under Title 16 - Commercial Practices, Section 453.2 states that it is "an unfair and deceptive act" for a funeral provider to fail to provide accurate price information for each of the specific funeral goods and services to persons inquiring about the purchase of funerals. The funeral provider must also provide to the customer an itemized written statement of all funeral expenses after the funeral arrangements have been made. The "lump sum" billing method previously allowed by the state and local taxing authorities is in violation of this law and should no longer be allowed by the state and local taxing jurisdictions. Also see Topic "Memorial Stones",

Dealer Absorbs Tax/ Tax Free Advertising

Effective July 1, 2001 a dealer may advertise that he will absorb the tax or relieve the purchaser from paying any or all of the tax if the dealer does the following: 1. The dealer includes in the advertisement that any part of the tax not paid by the customer will be remitted on behalf of the customer by the dealer and; 2. The dealer provides the customer with written evidence that the dealer will be liable for and will pay any tax that the customer did not pay.

Credit Union/ Federal Credit Union

Effective May 1, 1990 purchases by Federal Credit Unions are now considered sales to the Federal Government and therefore exempt from sales and use tax.

Barge Cleaning/ Car Wash/ Cleaning Service/ Pipe Cleaning/Tank Cleaning/ Textile Cleaning

Effective, August 1, 1992, washing of automobiles, trucks, other mobile equipment, pipes, and storage tanks where the owner of the business furnishes personnel and/or mechanical devices to assist in the cleaning is not a taxable cleaning service. However, the cleaning facility business owner must pay sales tax or accrue tax on materials consumed, i.e., soap, brushes, rags, wax, etc. When a packaged deal is offered with taxable and non-taxable components, the taxable/non-taxable portion must be segregated on the invoice or the entire charge is taxable. For example, an offer for an oil change, car wash, and carpet cleaning must separately state the charge for the taxable oil change and the taxable carpet cleaning. If this is done, the charge for the car wash is not taxable. Carpet cleaning in motor vehicles is a taxable service. When a customer uses equipment made available to him by a car wash establishment and does his own cleaning, there has been no taxable cleaning service rendered by the owner of the business. Cleaning services for laundering, pressing, and dying of clothing, furs, furniture, upholstery, carpets, and rugs (textiles) remains a taxable service.

School Buses

Effective, July 1, 1990, an independent school bus operator may purchase a new or used (less than 5 years old) school bus free of sales tax if the vehicle is to be used exclusively in the public school system.

Catalog

Effective, September 3, 1989, catalogs distributed within this state, without charge to the recipients, will no longer be subject to state and local sales and use taxes. Catalogs mailed directly from out-of-state printers free of charge are not subject to local or state tax because the company does not take physical possession of the catalogs. No use tax is due on Catalogs, brochures, newsletters, etc. printed by an out of parish printer and mailed directly from the printer to the customer because the company does not take physical possession of the material. Use tax would still be due on the catalogs, brouchures, newsletters, etc shipped directly to the store, hospital, etc. See Dillard's vs State

Liability/ Purchaser Tax Liability/ Seller Tax Liability/ Tax Liability

Either party, purchaser or seller, to any transaction, use, consumption, or lease involving tangible personal property and either the performer or recipient of taxable services is liable for payment of the tax.

Co-ops

Electrical Cooperatives are exempt from paying local sales and use taxes.

Electrical Co-Ops

Electrical Cooperatives are exempt from paying local sales and use taxes.

Excise Tax/ Federal Excise Tax

Federal excise taxes which are imposed on a producer, processor, manufacturer or importer, the import duties become a part of the dealer's cost and cannot be excluded from the tax base or sales price. The only exception is with respect to federal retailer's excise tax which must be collected from the customer or user. If those taxes are billed to the user or customer separately, they should be excluded from the tax base. However, if the excise tax is not separately stated, then the entire selling price, including the excise tax is taxable.

Florist/ FTD/ Nursery/ Teleflora

Florists are engaged in the business of selling tangible personal property at retail and all such sales are subject to tax. When florists conduct transactions through a florists' telegraphic delivery association: 1. On sales orders taken by a florist in this parish and telegraphed to another florist in Louisiana for delivery in Louisiana, the florist taking the sales order from the customer shall collect the tax. 2. On sales orders taken by a florist in this parish and delivered by the same florist to a customer in Louisiana, the florist located in this parish shall collect the applicable parish sales tax where the sales orders are delivered. 3. On sales orders taken by a florist in this parish and telegraphed to a florist located in another state for delivery in another state, the florist located in this parish shall collect the applicable sales tax. 4. When a florist in this parish receives telegraphic instructions from a florist located in another taxing jurisdiction for delivery in this parish, there is no tax with respect to the receipts realized by the florist located in the other taxing jurisdiction. The florist who takes the sales order from the customer collects the sales tax. When a nursery owner or florist sells shrubbery, young trees or similar items and as part of the transaction transplants them to the land of the purchaser for a lump sum or flat fee, he is considered the consumer of the shrubbery, trees or similar items and owes tax on the cost price of such items. However, when the nursery grows these trees, shrubs, etc. from seeds then they are considered the producer and can follow the farmer's exemption. (SEE ALSO TRIALS TOPIC "FARMERS")

Fraternity/ Masonic Orders/ Social Clubs/Sorority

Fraternities and sororities are considered private clubs subject to all applicable sales/use taxes. They are not state agencies.

Geophysical Survey and Data Analysis

Geophysical survey information and data analysis provided under a restricted use agreement are not subject to sales tax. This is considered a non taxable service.

Hospital Service District

Hospital Service Districts are exempt from the sales and use taxes imposed by the State or any of its agencies, parish and municipal governing authorities.

Interest/ Legal Interest/

INTEREST CHARGED ON DELINQUENT TAXES Each local taxing jurisdiction has their own interest rate to be used when calculating interest on delinquent sales/use taxes. Per 337:18, the sales/use tax shall be due and payable monthly on the first day of the month. The dealer has a "grace" period until the 20th of the month. All returns and remittances should be transmitted on or before the twentieth day of the month. If a taxpayer fails to pay a tax, or any portion thereof, on or before the day in which it is required, interest shall be added to the amount of tax due. Such interest shall be computed from the "due" date until the tax is paid. This means that you compute the interest daily beginning with the first day of the month. Example: A return paid on December 25 for a November return would have 25 days of interest. Assume the yearly rate of interest is 15%; therefore, you divide 15% by 365 days and get a daily rate of .0411%. So, if the tax due in this example is $100.00, the interest would be computed by multiplying $100 X 25 X .0411% = $1.03. REFUND INTEREST RATE Each collector shall compute on all refunds/credits and allow interest as part of the refund. Interest shall be computed at a rate of not less than two percent per annum. 1. From date of payment of the taxes, but prior to submission by the taxpayer of a claim for refund, interest shall be computed at a rate of not less that two percent per annum. 2. From date of submission by the taxpayer of a claim for refund, interest shall be at the average prime or reference rate as computed by the commissioner of financial institutions pursuant to R.S.13:4202(B), per year but without the addition of one percentage point to the average prime or reference rate and without regard to the limitations contained in R.S.13:4202(B). 3. The interest rate provided for in Paragraph (2) shall not be applicable for a sixty day period from the date the taxpayer makes a claim for refund, if a refund is the result of the taxpayer's administrative error; however, the interest for this sixty-day period shall be computed under the provisions of Paragraph (1). LEGAL INTEREST RATE Interest on payments under protest are from the date that the taxpayer gave the political subdivision notice of the taxpayer's intention to file suit for the recovery of the taxes paid. Interest shall be the average prime or reference rate as computed by the commissioner of financial institutions pursuant to R.S.47:4202(B), per year, but without the addition of one percentage point to the average prime or reference rate and without regard to the limitations contained in R.S. 13:4202(B). The Commissioner of Financial Institutions website is www.ofi.state.la.us and you can see the rate for the current year as well as the past years. The rates are valid for one calendar year. LEGAL INTEREST RATES FOR REFUNDS 12.00% per annum September 11, 1981 through December 31, 1987 09.75% per annum January 1, 1988 through December 31, 1988 11.50% per annum January 1, 1989 through December 31, 1990 11.00% per annum January 1, 1991 through December 31, 1991 09.00% per annum January 1, 1992 through December 31, 1992 07.00% per annum January 1, 1993 through December 31, 1994 08.75% per annum January 1, 1995 through December 31, 1995 09.75% per annum January 1, 1996 through December 31, 1996 09.25% per annum January 1, 1997 through July 31, 1997 * 7.90% per annum August 1, 1997 through December 31, 1997 * 7.60% per annum January 1, 1998 through December 31, 1998 06.73% per annum January 1, 1999 through December 31, 1999 7.285% per annum January 1, 2000 through December 31, 2000 8.241% per annum January 1, 2001 through December 31, 2001 05.75% per annum January 1, 2002 through December 31, 2002 04.50% per annum January 1, 2003 through December 31, 2003 05.25% per annum January 1, 2004 through December 31, 2004 06.00% per annum January 1, 2005 through December 31, 2005 08.00% per annum January 1, 2006 through December 31, 2006 09.50% per annum January 1, 2007 through December 31, 2007 08.50% per annum January 1, 2008 through December 31, 2008 05.50% per annum January 1, 2009 through December 31, 2009 03.75% per annum January 1, 2010 through December 31, 2010 * There are two different legal interest rates in 1997. Therefore, if you need to make an interest calculation for 1997, two separate calculations may be needed to determine the correct amount of interest.

Refund Interest

INTEREST CHARGED ON DELINQUENT TAXES Each local taxing jurisdiction has their own interest rate to be used when calculating interest on delinquent sales/use taxes. Per 337:18, the sales/use tax shall be due and payable monthly on the first day of the month. The dealer has a "grace" period until the 20th of the month. All returns and remittances should be transmitted on or before the twentieth day of the month. If a taxpayer fails to pay a tax, or any portion thereof, on or before the day in which it is required, interest shall be added to the amount of tax due. Such interest shall be computed from the "due" date until the tax is paid. This means that you compute the interest daily beginning with the first day of the month. Example: A return paid on December 25 for a November return would have 25 days of interest. Assume the yearly rate of interest is 15%; therefore, you divide 15% by 365 days and get a daily rate of .0411%. So, if the tax due in this example is $100.00, the interest would be computed by multiplying $100 X 25 X .0411% = $1.03. REFUND INTEREST RATE Each collector shall compute on all refunds/credits and allow interest as part of the refund. Interest shall be computed at a rate of not less than two percent per annum. 1. From date of payment of the taxes, but prior to submission by the taxpayer of a claim for refund, interest shall be computed at a rate of not less that two percent per annum. 2. From date of submission by the taxpayer of a claim for refund, interest shall be at the average prime or reference rate as computed by the commissioner of financial institutions pursuant to R.S.13:4202(B), per year but without the addition of one percentage point to the average prime or reference rate and without regard to the limitations contained in R.S.13:4202(B). 3. The interest rate provided for in Paragraph (2) shall not be applicable for a sixty day period from the date the taxpayer makes a claim for refund, if a refund is the result of the taxpayer's administrative error; however, the interest for this sixty-day period shall be computed under the provisions of Paragraph (1). LEGAL INTEREST RATE Interest on payments under protest are from the date that the taxpayer gave the political subdivision notice of the taxpayer's intention to file suit for the recovery of the taxes paid. Interest shall be the average prime or reference rate as computed by the commissioner of financial institutions pursuant to R.S.47:4202(B), per year, but without the addition of one percentage point to the average prime or reference rate and without regard to the limitations contained in R.S. 13:4202(B). The Commissioner of Financial Institutions website is www.ofi.state.la.us and you can see the rate for the current year as well as the past years. The rates are valid for one calendar year. LEGAL INTEREST RATES FOR REFUNDS 12.00% per annum September 11, 1981 through December 31, 1987 09.75% per annum January 1, 1988 through December 31, 1988 11.50% per annum January 1, 1989 through December 31, 1990 11.00% per annum January 1, 1991 through December 31, 1991 09.00% per annum January 1, 1992 through December 31, 1992 07.00% per annum January 1, 1993 through December 31, 1994 08.75% per annum January 1, 1995 through December 31, 1995 09.75% per annum January 1, 1996 through December 31, 1996 09.25% per annum January 1, 1997 through July 31, 1997 * 7.90% per annum August 1, 1997 through December 31, 1997 * 7.60% per annum January 1, 1998 through December 31, 1998 06.73% per annum January 1, 1999 through December 31, 1999 7.285% per annum January 1, 2000 through December 31, 2000 8.241% per annum January 1, 2001 through December 31, 2001 05.75% per annum January 1, 2002 through December 31, 2002 04.50% per annum January 1, 2003 through December 31, 2003 05.25% per annum January 1, 2004 through December 31, 2004 06.00% per annum January 1, 2005 through December 31, 2005 08.00% per annum January 1, 2006 through December 31, 2006 09.50% per annum January 1, 2007 through December 31, 2007 08.50% per annum January 1, 2008 through December 31, 2008 05.50% per annum January 1, 2009 through December 31, 2009 03.75% per annum January 1, 2010 through December 31, 2010 * There are two different legal interest rates in 1997. Therefore, if you need to make an interest calculation for 1997, two separate calculations may be needed to determine the correct amount of interest.

Credit Cards Issued by Govt/ Federal Government Purchases/ United States Government Purchases

If a Federal government check is used to purchase materials, then the purchase is tax exempt. Some purchases with Federal Credit Cards are exempt. See RR 07-008 for detailed explanation of the cards used for purchases that could be considered exempt for sales tax purposes. Applies to state and local. If an agency relationship is established with the Federal Government, review the contract to determine if the transactions are exempt. "Leases" and "Rentals" have been defined not to include property to be used in the performance of a contract with U.S. Government agencies. Excluded from the definition of "taxable sale of services" are actions performed pursuant to a contract with the U.S. Department for the Navy for the construction or overhaul of U.S. Naval Vessels

Nonresident Purchases

If a nonresident of the local taxing authority purchases articles of tangible personal property from a dealer in this parish and the transfer of title or possession takes place in the parish, the sale is subject to the tax levied by the local taxing authority. It is immaterial that the property purchased will be subsequently transported outside this local taxing authority or state.

Returned Merchandise

If articles of tangible personal property are voluntarily returned to the seller by the consumer, before such articles have been used but after tax has been collected or charged to the account of the consumer and not yet remitted to the local taxing jurisdiction. The seller may deduct the sales price of the articles from the gross proceeds shown on his report for the current month.

Penalty

If the amount of tax due by the dealer is not paid on or before the twentieth day of the month following the month for which the tax is due, the local taxing authority shall collect a penalty for the delinquent taxes. The penalty is 5% of the tax due if the tax is paid after the twentieth of the month following the month for which the tax is due. In addition, the local taxing authority can collect a penalty of 5% for each 30 day period thereafter that the taxes are delinquent, not to exceed 25% of the tax due. The penalty may be waived and must be requested in writing by the taxpayer. (SEE ALSO TRIALS TOPIC "TAX RETURN")

Imaging/ Microfilm/ Scanning

Imaging or microfilming services provided to businesses are considered taxable. Specific charges for additional copies of information is considered taxable. Taxable sales of services includes the furnishing of printing or overprinting, lithographic, multilith, blue printing, photostating or other similar services of reproducing written or graphic matter. RS 47:301(14)(d)

Imposition of Tax/ Tax Imposition

Imposition of Sales and Use Tax Cat's Meow, Inc v. City of New Orleans through the Department of Finance, Marina Kahn, Director Imposition of Tax, Constitutional Limit on Rate of Tax-Circle Food Stores, Inc v. The City of New Orleans and Paul Mitchell, Jr. Director of Finance Collection of local taxes, Provision for collecting local taxes-City of Bogalusa v. Washington Parish Sales and Use Tax Centralization Commission New taxes, Contracts enforce tax levy-D & A Construction Company v. Jefferson Davis Parish School Board Tax liability, Exemptions, Persons subject to or liable for tax-New Orleans Summer Pops, Incorporated v. Joseph Tregle, Collector of Revenue, State of Louisiana

Successor Liability

In order to insure that all taxes are paid by a discontinuing business, R.S. 47:308 and 47:337.21 require that the successor, successors, or assigns, if there are any, must withhold a sufficient portion of the purchase price to cover any taxes, penalties and interest due and unpaid at the time of the purchase. These funds must be withheld by the purchaser until the former owner can produce a receipt from the collector showing that the taxes have been paid or a certificate from the collector stating that there are no taxes, interest, or penalties due. If the purchaser of the business or of the stocks of goods fails to withhold sufficient funds with which to pay any taxes, penalties, or interest found to be due, he shall be held personally liable for the payment of the amount due.

Medicaid/Medicare/ Medicare Part B

In the Legislative Session of 2001, Act 60, effective July 1, 2001, the sale, lease or rental of tangible personal property covered under the provisions of Medicare are excluded from local sales and use tax. Prescription drugs purchased under Medicaid are not subject to tax, according to R.S. 47:305(D)(5). Prescription drugs purchased through or pursuant to a Medicare Part B and /or Part D plan shall be exempt from local sales tax. (Act 411 and 608 of 2006) See Topics on "Medicare" also 47:315.3 allows for a refund of tax paid by a person when purchases/leases of durable medical equipment are made under the provisions of Medicare.

Payment Under Protest

In the event a taxpayer believes that the collector has misinterpreted the law or rules and regulations contrary therewith, his remedy is by payment under protest and suit to recover. A taxpayer should exhaust admistrative remedies for filing refund claims prior to filing a suit.

Internet/ Web Site

Internet access charges are not subject to sales/use tax. Only the actual sale of electronic software or hardware is taxable. Companies having an internet business with nexus in your local taxing jurisdiction should register with the state and local taxing authorities. All the sales in the state are taxable and all the sales that take place in your parish are taxable. By having a location in your parish, they have nexus in your parish and would be required to collect your tax and also pay the use tax on any equipment that they would purchase. INTERNET SERVICE EQUIPMENT When internet service equipment is sold below cost in return for the customer signing a service agreement, this is bundling a taxable transaction, the sale of equipment, with a nontaxable transaction, the sale of wireless internet service. In both transactions, the sale of the equipment at the below-market price is contingent upon a customer signing a service contract. In essence, the contract represents part-payment for the non-taxable wireless internet service and part-payment for the taxable sale of the equipment. Thus, the entire cost should be subject to Louisiana sales/use tax. (PLR 08-010) APPLIES TO STATE AND LOCAL TAX

Fast Food/ Prepared Food/ Restaurant/ Restaurant Items/

Items such as napkins, straws, plastic forks, styrofoam plates and boxes etc. that automatically accompany the primary item sold are considered part of the sale, since the consumer has paid for these items as part of the purchase price and they clearly add value to the item purchased. When purchased by the restaurant, these items are considered as purchased for resale and tax exempt.

Fraud

La. R.S. 47:337.82 establishes the criminal penalty for failure to account for municipal tax monies. Punishment for collecting taxes and not remitting or other related frauds, for each monthly tax return, is a fine of not more than $10,000 or imprisonment, with or without hard labor, for not more than five years, or both. La. R.S. 47:337.83 sets criminal penalties for evasion of municipal sales/use tax. The fine for evasion of municipal sales/use tax is not to exceed more than $1,000 and/or imprisonment for not more than one year for each monthly tax return. La. R.S. 47:1641 and 1642 sets criminal penalties for failure to pay and failure to file state sales/use taxes. Time limitations on prescription of charges: Code of Criminal Procedure Art. 573 reads in part: "Time limitation established by Article 572 shall not commence to run as to the following offenses: (1) The offense charged is based on the misappropriation of any money or thing of value by one who, by virtue of his office, employment, or fiduciary relationship, has been entrusted there with or has control thereof." Act 894 of the 1993 Legislature provides that sales and use tax monies collected by a dealer shall be deemed the property of the state or political subdivision and shall be held in trust for the taxing authority.

Fabricators/ Foundry Men/ Machinists/ Pattern Makers

Machinists, foundry men and pattern makers who fabricate and sell dies, castings, patterns, tools, lathes, drill and punch presses, machinery, structural steel castings, or other tangible personal property are making taxable retail sales. Where such sales are made to manufacturers or construction contractors not registered as dealers or other persons, such sales are not for the purpose of resale and tax must be collected with respect thereto. Any charges for labor or service of fabrication or other costs of production may not be deducted from the sales price in computing tax.

Mail Order Sales/ Online Sales

Mail Order sales are subject to sales tax if the seller has nexus with the taxing jurisdiction. Nexus should be a physical presence in the taxing jurisdiction, such as a sales facility, warehouse, salespeople, offices, or service facilities. If the seller does not have a physical presence in the taxing jurisdiction, he is not required to collect and remit sales tax to the jurisdiction.

Machinery Equipment Exclusion

Manufacturers that have a NAICS Sector Code of 31-33 or Sector 11 are allowed to purchase manufacturing machinery and equipment free from state sales, use, lease and rental tax. The exclusion is phased in over time. Act 12 of the 2008 2nd Extraordinary Session accelerated the exclusion whereby the sales price shall be reduced by 100% effective July 1, 2009. Manufacturers that have a NAICS Sector Code beginning with 3361 (motor vehicle) are allowed to purchase manufacturing machinery and equipment free from state sales, use, lease and rental tax. Act 1 2007 Regular Session Applies to state with local option. The following local taxing authorities exclude these transactions: City of New Orleans, Jefferson Parish, Ouachita Policy Jury, City of Shreveport, Lake Charles (limited to EPA designated Brownfields areas), and Caddo Parish (limited to one geographic location)

Grave Stones/ Head Stones/ Memorial Stones/ Monuments/ Tombstone

Memorial stones are tangible personal property and when sold to users or consumers the sale thereof is taxable. When the seller of a memorial stone agrees to install such stone or monument upon a foundation, the seller is responsible for remitting use tax on the cost price of the stone or monument. See Topic "Funeral" also.

Warehouse

Moving, storing (other than cold storage), packing, and shipping tangible personal property belonging to others are activities that are considered nontaxable services.

MLS/ Multiple Listing Services

Multiple listing is a service providing realtors with information on real estate for sale in their area. The information provided is disseminated through computerized systems and multiple listing books. The company providing this service charges a monthly fee and is not required to charge sales tax on the monthly fee. The monthly fee is not subject to sales tax because the true nature of the transaction is to provide the real estate information. The multiple listing book is inconsequential to the overall service.

Magazines/ Newspapers/ Religious Newspapers

R.S. 47:301(16)(p) exempts the sale, use, distribution and storage of newspapers from the local taxing authorities. R.S. 47:305(D)(6) exempts newspapers from school boards and local government tax. RIB No. 08-017 Sales Taxes - Newspapers Excluded from the Definition of Term "Tangible Personal Property" Applies to state and local The State of Louisiana defines a newspaper as the following: "A newspaper is an unbound publication, appearing at regular intervals, having a second class mailing privilege, ** a paid bona fide circulation to actual subscribers, publishing a substantial part of its contents as news matter and containing reports of happenings of recent occurrences of a varied character designed for the information of the general reader." Magazine subscriptions are exempt at the local level. Sales of newspapers by religious organizations are exempt from sales/use tax. 47:305.14

Ice

Sales of ice by manufacturers and wholesalers to retail dealers who are actually engaged in the retail business of selling ice to users or consumers and have an established place of business are sales for resale and not subject to tax. All other sales of ice to consumers or users are subject to tax. ICE VENDING MACHINE: Sales of Ice from vending machines would be taxable at the local level. The courts have ruled that the exemption for sale of water didn't apply to sales of water from vending machines as the water had to be put into some kind of container regardless of who provided the container.

Refinery Gas

Refinery gas is subject to tax. Refinery gas is defined as a "waste" gas or "by-product" gas which is produced in the process of distilling crude petroleum into its marketable products. The annual cost basis computed by the Louisiana Department of Revenue and Taxation shall be the value at which such refinery gas is taxed. The annual cost basis per thousand cubic feet (MCF) by year is as follows: 2013 $1.596 2012 $1.797 2011 $1.556 2010 $1.405 2009 $.884 2008 $1.601 2007 $1.137 2006 $1.048 2005 $.837 2004 $.505 2003 $.441 2002 $.304 2001 $.58 2000 $.41 1999 $.20 The cost basis is determined by the formula provided by R.S. 47:305(D)(1)(h). Under the formula, the taxable value of refinery gas will be .52 cents per thousand cubic feet (MCF), multiplied by a fraction, the numerator of which shall be the posted price for a barrel of West Texas Intermediate Crude Oil as of December first of the preceding calendar year, and the denominator of which shall be $29.00. All energy sources, except for refinery gas, when used for boiler fuel are exempt from tax. Act 29(HB116) provides that refinery gas can be taxed only when consumed as an energy source by the owner of the facility in which it is created. This Act became effective on July 1, 1996.

Retail Sale/ Schools-Nonpublic/ Schools-Lunch

Retail sale or sale at retail is a sale to a consumer or to any other entity for any purpose other than resale in the form of tangible personal property and a sale of services. Sale at retail does not include sale of materials for further processing into articles of tangible personal property for sale at retail or sales of electricity for chlor-alkali SALES OF FOOD TO NONPUBLIC SCHOOLS (APPLIES TO STATE ONLY) ACT 430 2007 Regular Session-R.S. 47:301(10)(dd) For purposes of sales and use taxes imposed or levied by the state, the terms "retail sale" or "sale at retail" shall not include the purchase of food items for school lunch or breakfast programs by nonpublic elementary or secondary schools which participate in the National School Lunch and School Breakfast programs or the purchase of food items by nonprofit corporations which serve students in nonpublic elementary or secondary schools and which participate in the National School Lunch and School Breakfast programs.

Postage Stamps/Postal Services/Stamps/ United States Postal Service/ UPS

Routine delivery services provided by United Parcel Service (UPS), not in conjunction with a retail sale, are not taxable. Transactions involving the United States Postal Services (USPS), including the retail sale of stamps, are not taxable.

Wholesale Sales/ Wholesaler

Sales of tangible personal property by wholesalers to retailers, jobbers, dealers, or other wholesalers for resale are not sales at retail and therefore not subject to tax.

Return/ Tax Return

Sales tax returns shall be prepared and transmitted to the collector by all dealers on or before the twentieth day of each month for the preceding month. The Collector shall agree with a dealer to allow for quarterly reporting and remitting of the taxes under the sales and use tax law when such taxes amount to $30 or less per month. The Collector may agree with certain dealers or purchasers to accept their sales and use tax returns and remittances on an irregular basis, when past returns and knowledge of common business practice indicate to the collector that the only tax liability is as a result of infrequent transactions upon which sales or use tax is due. Gross proceeds from rentals or leases shall be reported and the tax shall be paid in accordance with rules and regulations for reporting as established by the Collector, in the month following the month in which the payment for the lease or rental is actually collected by the lessor. For the purpose of compensating the dealer in accounting for and remitting the tax levied by local ordinance, each dealer shall be allowed compensation at the rate specified in the local ordinance of the amount of tax due and accounted for and remitted to the taxing jurisdiction in the form of a deduction in submitting his report and paying the amount due by him, provided the amount due was not delinquent at the time of payment. If the amount of tax due by the dealer is not paid on or before the twentieth day of the month following the month for which the tax is due, there shall be collected with said tax, interest on the unpaid amount at the rate specified in the local ordinance, computed from the due date until paid. In addition there shall be collected a penalty of 5% after the 20th of the month, and a 5% penalty for each thirty day period thereafter, not to exceed 25% of the tax due. ELECTRONIC LOCAL RETURNS: In conjunction with other provisions of the UTC, authority was granted offering dealers to file electronic returns approved by the Uniform Electronic Local Return and Remittance Advisory Committee. Since October 1, 2008, an electronic local return has been operational under the La Dept of Revenue's website. The committee is currently working on development of a uniform paper return to be utilized by local collectors.

Membership Fees/ Sam's Club Fees

Sam's Club membership fees are taxable services subject to local tax. Sam's Club membership fees are charged on an annual basis and give a person the right to shop in the store. The general public is not allowed to shop in the store without a membership card. Other taxable membership fees include golf clubs and fitness and health clubs.

Sickle Cell Organizations

Sickle Cell disease organizations are excluded from paying sales and use tax. This applies to nonprofits established prior to 1975. 47:305.53 Exemption applies to state and local taxes. Exemption certificate required.

Louisiana Tax Free Shopping/ Tax Free Shopping

Some cities and/or towns participate in the Louisiana Tax Free Shopping Program. These cities/towns and their respective parishes must agree to the full terms and conditions as set forth in Act 35 of 1988. Retailers must charge the proper tax at the time of the sale. The customer will receive a voucher from the retailer to be redeemed at a certain location. Retailers are billed $100 per year for membership in the Louisiana Tax Free Shopping Commission. A portion of the tax may be excluded for certain reasons (multiple bond indebtedness, etc.). Consult with your tax administrator for details.

Restocking Fees

Some retailers charge a fee for restocking returned merchandise. For sales tax purposes, these "restocking fees" are not considered taxable.

Shoe Repair

The charges of shoe repairmen for the services of shoe repairing, shining or rebuilding are subject to tax. Sales to shoe repairmen of materials such as sole leather, rubber heels, thread and nails, which become a part of the articles repaired, are sales for resale and are not subject to tax.

Tiff

Summary: a local governmental subdivision may issue revenue bonds payable solely from an irrevocable pledge and dedication of up to the full amount of sales tax increments, in an amount to be determined by the local governmental subdivision, to finance or refinance an economic development project or any part thereof or a portion of the costs of an economic development project as specified in RS 33:9035 A sales tax increment shall consist of that portion of sales tax revenues for any or all taxing authorities(except the state) dedication of sales tax increments to pay the revenue bonds shall not impair existing obligations and shall not include tax revenues previously dedicated for a special purpose. Statutes: RS 33:9033 et seq; see acts 1995, no 1118 relative to legislative intent. See Acts 2006 numbers 240 & 435 relative to interpretation and application of the prohibition regarding use of sales tax increments of the state or a political subdivision with coterminous boundaries to those of the state for tax increment financing as provided in RS 33:9033 Cabela's- The court agreed that a political subdivision had the right to set up another entity to issue bonds. (See Bd of Dir of the Ind Dev Bd court case)

Driving Range/Arcade Games/ Audience Surveys/Baseball Hitting Machine/ Batting Cages/ Bowling Alleys/ Golf (Putt Putt)/ Miniature Golf/ Motion Picture Theaters/ Movie Theaters/ Pinball/ Pool Table/ Putt-Putt Golf/ Radio Survey/ Theater(Movie)/ TV Survey

TAXABLE AMUSEMENT FEES (including but not limited to): - Fees charged for BOWLING at a bowling alley - PUTT-PUTT GOLF fees - GOLF DRIVING RANGE fees - GOLF COURSE fees - MOVIE THEATER ticket sales - POOL TABLES rented by the hour (pool hall) fees NON-TAXABLE AMUSEMENT FEES (including but not limited to): - PINBALL MACHINE and other ARCADE GAME receipts (revenues) - BATTING CAGE (hitting machines) fees - COIN OPERATED POOL TABLES receipts (revenues) - Custom prepared AUDIENCE SURVEYS

Interruption of Prescription/ Prescription of Tax

Taxes (except for real property taxes) and licenses shall prescribe in three years after the thirty-first day of December in the year in which they are due. When a dealer collects sales taxes and fails to remit them to a local taxing jurisdiction, a prescriptive period of ten years will apply. This rule applies whether or not the dealer is registered to collect and remit taxes with the local taxing jurisdiction. SEE Sabine Pipe & Supply vs McNamara - The court ruled that by collecting the tax, a fiduciary relationship was established between the dealer and the state. Because this fiduciary relationship was established, the state "is not barred by the three-year prescription from requiring its fiduciary to turn over to it sums collected on its behalf". The prescriptive period in this case was set at 10 years. For refunds, a dealer that has made an overpayment of his taxes may file with the Director a claim for refund at any time within three years from December 31st of the year in which the tax became due or within one year from the date the tax was paid. Refunds must be propely filed against taxing jurisdiction before it can be brought before the court. (See Clark..... vs State of LA) The prescription period running against such sales and use tax shall be interrupted by any of the following: 1) Assessing the tax in a manner prescribed by law. 2)Filing a summary judgement proceeding in court. 3)Filing of pleadings (suit) by the taxpayer or local government with courts. 4)Filing a false or fraudulent return. 5)Failure to file a tax return with the appropriate jurisdiction. 6)Waiver of prescription document properly executed by both parties. 7)Filing a lien on the taxpayer with the courts.

Erroneous/Estoppel

Taxing jurisdiction can not be estopped from collecting a tax that is legally due, even if the taxpayer relies on erroneous information provided by a taxing jurisdiction.

Facsimile/ Fax/ Fax Machine/

Telephone fax transmissions are not considered taxable by the local taxing jurisdictions. Any business providing these services would still owe sales/use tax on equipment and materials consumed in the business. The State of Louisiana considers incoming faxes taxable. A business providing fax services would have to charge only state sales tax on incoming fax services. The transmission over the phone line used to receive incoming faxes are taxable on the state level. The sale, repair and maintenance contracts on facsimile machines are taxable as retail sales or repairs to tangible personal property.

Phone Systems/ Satellite TV Systems/ Telephone Directories/ Telephone Systems

Telephone systems that are permanently attached to real property arenot taxable retail sales. Satellite television systems that are permanently attached to real property are not taxable retail sales. The seller is considered the user or consumer of these telephone and satellite systems and must pay sales or use tax on the acquisition cost or cost price of the system. This sales or use tax is considered a business expense to the seller and should be included in the contract price and not separately stated as sales tax. On site repairs to an immovable and extended warranty contracts on immovable property are not taxable (materials and labor). Items removed from their fixed location and brought to a shop to repair are considered movable and subject to the tax. Satellite television service subscription fees are not taxable. Telephone directories distributed free of charge by advertising companies not associated with telephone service providers, are excluded from the general sales and use tax associated with these directories. 47:301(10)(t)

Enterprise Zones

The Enterprise Zone program established in 1981 offers tax rebates to qualified businesses. This is not a tax exemption, but a rebate of sales/ use taxes paid to the state or local taxing authority. Vendor's compensation is considered when calculating the tax rebate. Qualifying Purchases: (a) Depreciable capital assets (b) Equipment used in the business (desks, copy machines), (c) Components of building, (d) General construction items (sheetrock, lumber, concrete & shrubs), (e) Office equipment, (f) software, as long as these items are used in the business enterprise and not in the construction phase. Non-Qualifying Purchases: (a) Small hand tools, (b) Safety equipment, (c) Office supplies, (d) Blueprints & photos, (e) Repairs to equipment, (f) Lease and rentals, (g) Contractor purchases consumed in construction (not passed on to customer), (h) Vehicles licensed for highway use.

Disaster/ American Red Cross/ Flood/ Hurricane/ Red Cross

The State of Louisiana has a refund provision that applies to refunding state sales/use tax on tangible personal property destroyed by a natural disaster. It applies to areas of Louisiana that warrant disaster assistance by the federal government by order of the President of the United States. It covers only losses that were uninsured. This does not apply to businesses, only individuals. This State refund does not apply to local governments. The American Red Cross was chartered by the U. S. Congress and considered by many taxing jurisdictions to be an instrumentality of the U. S. Government. The Federal Emergency Management Agency "FEMA" is a federal agency. Both of these are exempt from state sales tax on their direct purchases. For local taxes, you should contact your local taxing authority to determine taxability. When the Red Cross or FEMA assistance money is paid by check, or deposited directly into an individual's checking account, it becomes the individual's personal asset and subsequent purchases made with these funds are not exempt from taxation.

Earmarked/Storage

The Uniform Tax Code (UTC) levies a tax on storage of tangible personal property for use or consumption in a taxing jurisdiction. However, 47:337.12 states property that was purchased outside a local taxing jurisdiction, delivered into the local taxing jurisdiction by common carrier, and the invoice or purchase order is documented, (earmarked), for use outside the local taxing jurisdiction is not subject to the taxing jurisdiction's use tax. Property stored in the local taxing jurisdiction for use outside the local taxing jurisdiction should be earmarked as such, otherwise, it will be treated as taxable. No use tax is due although such property may be stored in the local taxing jurisdiction for an indefinite period of time. If any ownership rights are exercised over the property (except storage) while in the local taxing jurisdiction, then the use tax would be due. Examples of use would be maintenance work, assembly, testing, cleaning, or goods placed in a rental inventory. The prohibition against taxing property earmarked and stored for use outside the political subdivision does NOT apply to sales tax transactions. Examples of sales tax transactions are delivery of goods by the vendor in the vendor's truck to the buyer or the buyer picking up items from the seller's business location. A local regulation has been promulgated on this issue. (see references) Law determines that sales/use tax is due where tangible personal property is delivered. If the purchaser picks up the tangible personal property the taxes are due where the property is picked up. If items are delivered by a common carrier and ear-marked for use in another jurisdiction, the taxes are due to the jurisdiction of use. If items are delivered in the vendor's truck, even if ear-marked for use in another taxing jurisdiction, the taxes are due to the jurisdiction of delivery. Delivery by the vendor's truck to the buyer's location makes this transaction a sales tax transaction. Separate charges for delivery to a lessor is not taxable to the lessee. La. RS 33:2717.2 is a prohibition on levy or collection of tax on property stored for use outside the political subdivision. There are 3 parts of the statute: proper documentation is required prior to or at the time of sale, exemption certificate should be provided, and if property is removed from storage and is used within the political subdivision, the property shall be subject to taxation.

Towing Service/ Wrecker Service

The charge for towing a motor vehicle is not a taxable service. If the towing charge is included in the price of a repair of a motor vehicle, then the entire charge for the repair is taxable, even if the towing charge is separately stated. (SEE ALSO TRIALS TOPIC "REPAIR")

Tanning Salon

The charges for tanning sessions at a tanning salon, which is not a part of an athletic, amusement, entertainment or recreational facility, are not taxable. The Louisiana Dept. of Revenue is also in agreement with this.

Fast Food Container/ Napkins/ Straws/ Utensils

The containers used by fast food businesses which actually accompany the products sold to the consumer without which the delivery of such products is impractical due to the character of the contents, and for which there is no separate charge, are not subject to tax. For example, trays, cups, lids, cardboard containers, and/or bags. (SEE ALSO TRIALS TOPIC "PACKAGING") Napkins, straws, forks, salt and pepper, ketchup, stir sticks, and other items which accompany the primary items sold, and for which there is no separate charge, are not subject to tax and may be purchased by the business under a resale certificate.

Food Stamps/ Motor Fuel/ WIC Vouchers

The following are STATE EXEMPTIONS WITH PROHIBITIONS ON TAXATION: La Constitution Art. VII Section 27 Prohibits the taxation of fuel that is subject to the road-use excise tax. Purchases made with food stamps and WIC vouchers cannot be taxed. 47:305.46

Plates/ Printers/ Printing

The following list of raw materials, when purchased by a printer, are exempt from sales/use taxes imposed by the state or any political subdivision: artwork, blankets and bars, chemicals, color separations, dies, film (including negatives), offset plates, press proofs and photomechanical proofs, layouts, typesetting, rubber plates, paper, and ink. This exemption applies only to purchases made by a printer, not sales of tangible personal property made by a printer. The final product (i.e. business cards, letterhead, booklets, etc.), when sold to the final consumer by the printer, is subject to sales and/or use tax. There is no reduction in the taxable base selling price regardless of separately stated charges on the printer's sales invoice for items such as labor, setup, artwork, etc.

Export Sales

The power to regulate commerce with foreign nations is vested in the Congress of the United States. Accordingly, the taxing jurisdictions do not tax sales of tangible personal property requiring shipment to a foreign country.

Parking/ Valet Parking

The furnishing of parking privileges by auto hotels and parking lots is a taxable service. Persons who regularly furnish space for the parking or storage of automobiles, trucks, trailers, or other vehicles are deemed to be operators of parking lots. Charges made for the parking of trailers which are not permanently affixed to foundations other than their own wheels are taxable. The total charges made for such storage or parking privileges are taxable whether such charges are made by hotels, hospitals or any other person. Valet parking charges are considered part of the parking service and therefore taxable. Valet parking charges are taxable even when parking is "free" and there is a charge for valet parking. Rental of real property for a flat fee is not taxable when the property is used for parking and no parking fees are collected from individual parkers. 47:305.18 exempts parking fees for fairs, festivals and expositions sponsored by nonprofit organizations chartered in Louisiana.

Insurance Premium Tax

The insurance premium tax (IPT) is charged to all insurance companies doing business in a taxing jurisdiction, regardless of whether or not they have a physical presence in the taxing jurisdiction. R.S. 22:1076 authorizes local taxing authorities to impose a license tax on insurance companies. The IPT may be charged by each municipality and by the parish. The tax amount owed by each insurance company is based on the amount of insured risk in the local taxing jurisdiction. The rate of tax to be imposed is determined by each taxing authority. Companies providing re-insurance policies are subject to the IPT. HMO's established under R.S. 22:2016 and bail bond businesses are not subject to the IPT.

Video Draw Poker

The purchase and sale of video draw poker machines are subject to local sales/use tax. There is an annual license fee that is assessed by local governments for each machine located in the Parish also. R.S. 33:4862.14 and Act 1062 of the 1991 Legislative Session apply to video poker machines. VIDEO BINGO When a Distributor rents/leases video bingo equipment and the software to a Charity who in turns re-leases the equipment and software to a player, both transactions are taxable rental/leases. Applies to both state and local (RR 08-009 & RR 08-010)

Immovable Property/Permanent Property/ Real Property

The repair of immovable property is not a taxable service. The repair dealer is deemed the consumer of the materials and parts used. If he has not paid tax on such materials and parts because he purchased them under a resale exemption certificate, he must report the transactions and pay tax at the time they are used.

Check Cashing/ Money Order

The sale of a money order is not subject to sales/use tax. Check cashing is not subject to sales/use tax.

Drapery

The sale of drapes is considered a sale of tangible personal property (movable) and subject to sales/use tax. If the seller of the drapes performs the installation, then the separately stated charges for installation are not taxable. If no separation for installation charges exist on the invoice, then the entire invoice amount is taxable.

Gift Cards/ Gift Certificates

The sale of gift certificates by a restaurant, department store, etc., is not taxable, since the gift certificate is merely a means of payment similar to cash or a check. The sale for which the gift certificate is used as a means of payment is taxable and the proper tax must be collected.

Jeweler

The sale of jewelry items and such are subject to the sales/use tax. Engraving charges are taxable as further fabrication of tangible personal property. The cleaning of jewelry is not a taxable cleaning service and is not subject to tax. All repairs to clocks, watches, and all other jewelry is considered a taxable repair. The jeweler would be responsible for the sales/use tax on all articles of equipment, machinery, tools, or other supplies that are used by them in the store and is incidental to the rendering of such services.

Drilling Barges/Drilling Rigs/Drilling Ships/ Barges/ Boats/ Offshore Equipment Repair/ Offshore Purchases/ Ships/ Vessels

The sale of materials and supplies, the furnishing of repair services, the sale of materials and supplies used in such repairs when they enter into and become a component part of ships or vessels operating exclusively in foreign or interstate coastwise commerce, and laundry services when purchased by owners and operators of such vessels are not subject to tax. Repairs and materials used on drilling rigs used exclusively for exploration and development of minerals outside the territorial limits of the state in outer continental shelf waters are exempt from sales/use tax. The definition of a drilling rig is defined in 47:305(I). An exemption from sales/use tax exists for the purchase of materials, equipment and machinery that become a component part of ships, vessels and barges with a 50-ton load displacement. Drilling ships and barges are also exempt. This exemption also allows ships operating in interstate commerce to purchase materials, repair services and laundry services. 47:305.1(B) Property purchased for exclusive use offshore is exempt from sales/use tax. 47:305.10. Charges for repairs performed in Louisiana for use offshore are taxable except those described in 47:305(I)

Vending Machines

The sale, use or leasing of vending machines is subject to tax. For local tax purposes, sales of tangible personal property via vending machines are taxable, and the seller of the merchandise vended is responsible for the reporting and payment of tax. Vending machine merchandise must be purchased with a resale exemption certificate, obtainable from local tax administrator. For state tax purposes, the State of Louisiana requires that tax be paid on the cost of the merchandise to be vended, not on the sales price. **Vending machine prices include the local sales tax which should be backed out when reporting local sales. Commissions received by businesses are not subject to sales/use tax. The sales/use tax is based on total machine sales and remitted by the business responsible for servicing and maintaining the machine.

Pacemakers

The sales of medical devices such as cardiac pacemakers, used personally and exclusively by the patient are taxable at the local level but are exempt from state sales tax. Based on local ordinances, some local jurisdictions may either partially or fully exempt these transactions.

Cash Discounts

The sales price of an article of tangible personal property does not include the amount of bona fide cash discounts actually taken by the buyer, and the amount of such discounts may be deducted from taxable sales if such discount has been previously reported in taxable sales.

Stocks

The term tangible "personal property" does not include stocks, bonds, notes or other obligations or securities, and accordingly, the sale of such is not subject to tax.

Attorney/ CPA/ Professionals

The work product of certain licensed or regulated professionals under Title 37 are not subject to sales/use tax. Attorneys, Accountants, etc. This does not apply to the creation, modification, updating or licensing of computer software.

Bullion/ Gold Coins/ Silver Coins

These items are exempt from tax per R.S. 47:301(16); a specific exception from the definition of tangible personal property . The term tangible personal property shall not include: ii) Gold, silver, or numismatic coins, or platinum, gold, or silver bullion having a total value of one thousand dollars or more.

Sparta Groundwater/Water Conservation Equip.

To enact R.S. 47:305.56 and 337.9(D)(28), relative to sales and use tax exemptions; to provide for a state and local sales and use tax exemption for certain water conservation equipment in the Sparta Groundwater Conservation District (in north central La.); to provide for an effective date July 1, 2007, through June 30, 2010; and to provide for related matters. Only persons defined as "users" under R.S. 38:3087.133(7) shall be eligible for this exemption. APPLIES TO STATE AND LOCAL

Bus Fares/ Taxi Fares

Transportation services by taxi, boat, bus, or other instrumentalities for a fare are not taxable. The transactions are taxable when the price paid is in the form of a rental and not a fare.

Exchanges/ Exchanges and Adjustments/ Merchandise Returns/ Returns

When any tangible personal property is returned to the seller for adjustment or exchange under a guarantee as to its quality of service and a new article is given pursuant to guarantee, tax shall be due on the additional amount, if any, to be paid to the seller.

Annual Sales Tax Holiday/ Sales Tax Holidays- Annual

(APPLIES TO STATE TAX and St. Charles Parish only.) Louisiana Revised Statute 47:305.54, the "Annual Louisiana Sales Tax Holidays Act," provides an exemption from state sales tax on the first $2,500 of the purchase price of most individual items of tangible personal property for non-business use on the first consecutive Friday and Saturday of each August. The state sales tax is payable on the portion of the purchase price of any individual item in excess of $2,500.00 Purchases Eligible for Exemption The exemption will apply statewide to all consumer purchases of tangible personal property, other than vehicles subject to license and title and meals furnished for consumption on the premises where purchased, including to-go orders, provided that the property is not for use in a business, trade, or profession. Applies to consumer purchases only, business purchases not eligible for exemption. See RIB 08-018 and 08-018A for eligible purchases. Act 173 2007 Regular Session authorizes St. Charles Parish to participate. HURRICANE PREPARDENESS-See Hurricanes 2nd ADMENDMENT HUNTERS HOLIDAY-see Hunters Holiday, 2nd Amendment Holiday

Claims against State

Any person who has a claim against the State of Louisiana for money erroneously paid into the State Treasury, or for any other claim, may present such claim to the Board of Tax Appeals, in such form and together with such proofs as the Board of Tax Appeals may require by its rules and regulations. The Board shall duly examine the justice, merits and correctness of each claim presented to it, and shall officially pass thereon.

Carpet Cleaning/ Rug Cleaning

As a general rule, routine carpet cleaning is a taxable service. There are exceptions as follows: 1. Disaster restoration - cleaned after floods, etc., where entire building is being restored, then it will not be taxable. 2. Janitorial contract - if the contract does not list carpet cleaning and the customer is not separately charged for it, and if it is performed infrequently and not routinely, then it will not be taxable. Installation charges for carpet, when separately stated on the invoice from the cost price of the carpet, are not subject to tax. Failure to segregate these charges will subject the entire amount to the tax.

Auto/ Motor Vehicle/Car

47:303(A) grants a credit for use tax paid on automobiles imported by certain members of the armed services. 47:305.48 is another exemption for military personnel. The casual sale exclusion does not apply to the sale of automobiles and trailers. See Also, Topic "Credit for Tax Paid" This will explain how to calculate use tax on cars imported into a local jurisdiction.

Auction/ Auctioneer

Auctioneers are required to collect sales tax on the sales of tangible personal property. The same rule applies to lien holders, such as storage men, pawnbrokers and artisans. This rule does not apply to trustees and auctioneers at bankruptcy auctions.

Auto Body Shops/ Auto Refinishers

Automobile refinishers, automobile painters and automobile repair shops are furnishing repairs to tangible personal property. The entire amount charged for such services, including any charge for materials, parts used and labor is subject to tax. Materials and parts purchased by such businesses which will become a part of the automobiles refinished, repaired or painted can be purchased with resale exemption certificates.

Commercial Fisherman/ Fisherman/ Seafood Processing Facilities

A Louisiana resident, domiciled in Louisiana, who possesses such valid Louisiana commercial fishing licenses as may be necessary for commercial fishing ventures, and who is an owner-operator of a vessel operated primarily for the conduct of commercial fishing as a trade or business and which the Louisiana Department of Wildlife and Fisheries determines that more than 50% of income is earned from commercial fishing activities and principally used for commercial fishing ventures and whose catch is for human consumption shall be exempt from State of Louisiana sales and use taxes. This exemption does not apply to local sales and use tax. (APPLIES TO STATE ONLY) (Charter boat activity does not qualify as commercial fishing.) APPLIES TO STATE TAX ONLY: Seafood processing facilities are allowed to purchase materials, supplies and repair services exempt from the State general sales tax. This exemption applies only to processing facilities that process seafood from vessels owned, leased, or contracted exclusively to the facility

Adaptive Driving Equipment/ Ingestible medical capsule/ Medical - Car Modifications/ Medical Device/ Medical Equipment/ Medical Imaging Equipment/ Medical Linear Accelerators/Medical Related Items/ MRI's/ Orthotic Device/ Prosthetic Device/ X-Ray

A medical device is an item that comes in direct physical contact with a patient's body, must be used for a single patient, be disposable in nature and provided to one patient and used in the treatment of a disease. An orthotic device deals with the support and bracing of weak and ineffective joints or muscles. A prosthetic device is an artificial device used to replace a missing part of the body. Act 463 -2007 Legislative Session also exempts Eye Glasses and Contact Lens from STATE sales and use tax. The sales of orthotic, prosthetic, ostomy, ileostomy, colostomy services, and patient aids are sales of tangible personal property that are subject to tax. However, the State of Louisiana and some local taxing jurisdictions exempt all or a portion of the sales of medical devices. This exemption also applies to orthotic devices, prosthetic devices, prostheses, and restorative materials used or prescribed by dentists. Fees paid for use of eye surgery machines are subject to tax. Adaptive driving equipment and motor vehicle modifications are not subject to sales and use tax when prescribed by a physician, licensed chiropractor or a driver rehabilitation specialists licensed by the State. 47:305(D)(1)(u) INGESTIBLE MEDICAL CAPSULE: Ingestible Medical Capsule used for diagnostic procedures is exempt from State tax as a medical device under R.S. 47:305(D)(1)(s). Applies to state tax only with local option. X-Ray equipment, Regents etc exempt at the state level with local option.(See Med. Diag. Svc.)

2nd Amendment Weekend

A. This Act shall be known as the Annual Louisiana Second Amendment Weekend Holiday Act. B. Notwithstanding any other provisions of law to the contrary, the sales and use tax levied by the state of Louisiana and its political subdivisions shall not apply to the sales price or cost price of any consumer purchases of FIREARMS, AMMUNITION and OTHER HUNTING SUPPLIES that occur each calendar year on the first consecutive Friday through Sunday of September. *This only applies to purchases by consumers; purchases by businesses are not exempt.

Cash Register Programming

APPLIES TO STATE ONLY: A $25 credit per cash register is allowed by the State to recoup cost incurred to reprogram cash registers because of changes in the sales tax rate or tax base. Acts 1990, No. 386, Section 4

ATV/ Off Road Vehicles

APPLIES TO STATE TAX ONLY. Act 291 2007 Legislative Session-To amend and reenact R.S. 47:303(E)(1) and 304(A) and to enact R.S. 47:305.56, relative to sales and use taxes; to provide relative to the collection of sales and use taxes on off-road vehicles; to exempt certain purchases of off-road vehicles from collection of state sales and use taxes; to provide for an effective date; and to provide for related matters. §305.56. Exemption; off-road vehicles; out-of-state buyers The sales and use tax imposed by the state of Louisiana shall not apply to the sale of off-road vehicles when purchased by a buyer who, at the time of purchase, presents proof to the seller that he is domiciled in another state and signs an affidavit that he has paid or will pay the sales and use tax on the off-road vehicle in the state in which he is domiciled within sixty days after the date of purchase or delivery, whichever is later; provided that the state in which the buyer is domiciled provides a similar exemption. A valid out-of-state driver's license or state-issued picture identification card shall constitute sufficient proof that the buyer is domiciled in another state. Section 2. This Act shall become effective on October 1, 2007. APPLIES TO STATE TAX ONLY.

Blighted Area Housing Renovations/ Housing Renovations

APPLIES TO STATE TAX ONLY: Materials used in the construction, restoration, or renovation of housing in designated areas can receive a financial incentive to improve conditions in blighted areas.

Caterer

AT CATERING FACILITY - FULLY TAXABLE If a caterer prepares, furnishes, or serves tangible personal property which is consumed on his premises, those activities, whether billed as one item or billed separately, constitute a taxable sale. AT CUSTOMER LOCATION - PARTIALLY TAXABLE If a caterer prepares, furnishes, or serves tangible personal property not consumed on the caterer's premises, the preparing and serving are not part of the taxable sale, if, and only if, a separate charge is made for the preparation and serving. All consumables served by a caterer at the customer's premises or designated location are included in taxable sales. SALES/USE TAX DUE ON NON-RESALE PURCHASES ONLY - Purchases by a caterer of items such as food, drinks, ingredients, non- reusable food containers, etc., that become the customer's property at the time the meal is served are purchases for resale. - Purchases by a caterer of items such as tablecloths, napkins, equipment, etc., that are not sold but are used by the caterer are taxable.

Boys State of Louisiana/Girls State of Louisiana

Act 20 (SB 63) excludes from taxation sales to Boys State of Louisiana Inc., and Girls State of Louisiana, Inc. Effective July 1, 1996.

Auto Demonstrators/ Boat Demonstrators/ Demonstrators/ Driver Education Vehicle/ Motor Vehicle Demonstrators/ Program Vehicles/ Watercraft Demonstrators/

Act 442 of 2009 Regular Session expanded the scope of what is considered as demonstrators. Added are new boats, vessels or other watercraft withdrawn from factory authorized dealers for use as demonstrators. See act for specific guidelines as to what would qualify as a demonstrator. Applies to state and local taxing jurisdictions. New trucks, new automobiles, and new aircraft withdrawn from stock by factory authorized new automobile and new aircraft dealers, and used trucks and used automobiles withdrawn from stock by new or used motor vehicle dealers, with the approval of the Secretary of the Department of Revenue and Taxation and titled in the dealer's name for use as demonstrators, are exempt from tax; however, when such vehicle or aircraft is sold, tax shall be collected. The demonstrators cannot be used by members of the family of dealership personnel or for personal use. This is a suspended exemption for state sales/use tax through June 30, 2009. APPLIES TO STATE TAX ONLY: New car dealers may withdraw new vehicles from inventory for use by secondary schools, colleges, or public school boards in accredited driver education programs without payment of sales tax. 47:305.26

Beauticians/Beauty Shop/ Barbers/ Cosmetologists/ Hair Salon/ Nail Salon/Salon

Barbers and cosmetologists render personal services which are not taxable. They are consumers of the various items which are used or consumed in the rendition of their services. Sales of such tangible personal property to them are, therefore, retail sales and subject to tax. If these persons sell beauty products to the public, they are required to register as dealers and collect the tax from their customers, but may purchase such products under a resale exemption certificate.

Advertising Agencies/ Catalogs-Advertise/ Circular/ Flyers

Advertising businesses transferring mass-produced advertising items, which manufactures the item itself to a client for the client's use, which transfer involves the furnishing of minimal services other than manufacturing services by the advertising business shall be a taxable sale or use of tangible personal property. The property may be in the form of printed material, graphic matter, novelty items, logo design, layout, etc. La R.S. 47:301(13) defines taxable sales price to include any and all services and materials used to produce the product. Note that taxes are not due on creative services rendered, provided it is separately invoiced. Advertising transactions involving furnishing of services related to an advertising program are not taxable. Examples are placement of ads and distribution of items to achieve a specific goal for the client. Any tangible personal property developed as part of an advertising program and distributed by the advertising agency to a party other than the client is considered to be part of the advertising program (not taxable). The tangible personal property purchased or consumed in order to perform the service is subject to a use tax, based on the cost price of the property. (Effective date January 1, 1982) Newspaper inserts printed and delivered directly to local Louisiana newspapers for distribution are not taxable. Direct mailers printed by an out of state printer and delivered to a third party for distribution to specific customers in Louisiana are not taxable. Store copies of printed advertisements, flyers or circulars delivered to a store in a taxing jurisdiction are taxable. Printed catalogs are not taxable.

Aircraft/ Aircraft Assembly Plant/ Airplane/ Commuter Airlines Louisiana/Helicopter/Ultra Lights

Aircraft, including but not limited to airplanes, helicopters, aircraft kits, ultra lights, etc., are tangible personal property, the sale, lease or repair of which is subject to tax, with the following exemptions: 1. Antique airplanes are not subject to tax. The airplane must be at least 25 years old, maintained by a private collector, and not used for commercial purposes. RS 47:6001 2. Purchases or lessees of airplane equipment, airplane parts, and airplanes by any commuter airline domiciled in the State of Louisiana are not subject to sales, use or lease tax. 47:301(7)(d) and (10)(k) 3. Any helicopter which is to be used directly in the exploration for, or the extraction or production of, oil, gas, and other minerals, or helicopters used in providing services to other businesses which are engaged in such activities may be acquired through a lease transaction and this transaction will be considered a sale. The lessor or renter shall not incur a sales or use tax liability on the acquisition of the helicopter for lease. 4. Airplane fuel sales are exempt from sales tax. 5. Certain aircraft assembled in Louisiana with a capacity of 50 people or more. 47:301(10)(m) RR 07-002-A provides additional information concerning the Department of Revenue's prospective application of the Word of Life La Supreme Court Decision affecting the use taxation of airplanes.

Alternative Fuel Source/ Boiler Fuel/ By Product Material/ Coke-on-Catalyst/ Pelletized Paper Waster

All energy sources, except for refinery gas, when used for boiler fuel are exempt from tax. The courts determined that coke-on-catalyst is eligible for sales and use tax exemption under R.S. 47:305(D)(1)(h) when used as a boiler fuel energy source. Act 29(HB 116) 1996 eliminates local taxing jurisdiction's authority to tax coke-on-catalyst, and other fuel sources used for non-boiler fuels and the consumption of any residue or byproduct products. (Effective July 1, 1996) Refinery gas can be taxed only when consumed as an energy source by the owner of the facility in which it is created. Pelletized paper waste used in a permitted boiler as fuel. 47:301(10)(n) Alternate substances used as a fuel are excluded from the definition of "retail sale" and "use". Includes petroleum coke, waste oil, etc. 47:301(10)(z) and (18)(l). Sales/use tax shall not apply to any residue or by-product created as part of a manufacturing process, except refinery gas, which is used by the producer of the property. Examples are catalyst coke, wood chips, bark, liquor derived from timber processing and biogases from sugarcane processing. 47:301(18)(d0(ii)

Buses Interstate Commerce/ Louisiana Mileage Interstate Commerce/ Transportation Interstate Commerce/ Trucks and Trailers Interstate Commerce

Certain trucks and trailers and contract carrier buses used 80% in interstate commerce. This exemption allows for the tax free purchase of trucks and trailers and contract carrier buses that exceed 26,000 pounds and are used 80% or more in interstate commerce. Buses must have a minimum capacity of 35 passengers. 47:305.50(A) and 47:305(A)(1)(a) 47:306.1 and 47:306.2 allow for an alternative method of tax payment for transportation companies operating in interstate commerce. Remittances can be based on "Louisiana Mileage" Firestone Vs Calcasieu - Tax due on rental of containers used for shipping materials and returned to Firestone.

Admission Charge/ Cover Charges/ Little Theater/ Motion Picture Film Rental/Symphony Organizations/ Theater Film Rental/

Charges for admission to places of amusement, entertainment, recreation, or athletic events, except those sponsored by schools, colleges and universities, are classified as sales of services and as such are taxable. Note that LA R.S. 47:305.13 grants a limited exemption to organizations created under the laws of the state of Louisiana as nonprofit, charitable, educational, or religious organizations from state and local sales or use tax on the sale of admissions to entertainment events. Such sales of admissions are exempt only when the entire proceeds, with the exception of necessary expenses connected with the event, are used for the purpose for which the organization was formed.

Cold Storage

Charges for the service of furnishing cold storage space and for the service of providing tangible personal property for cold storage, when such service is incidental to the operation of cold storage facilities, are taxable.

Coating/ Galvanizing/Threading/ Wrapping/

Charges made for coating, wrapping, threading and galvanizing of pipe and other property which have not been previously treated by such methods are considered to be fabrications by R.S. 47:301(12). Fabrications are considered taxable sales and the vendor is required to collect sales tax on the gross proceeds from coating, wrapping, threading, and galvanizing transactions. The re-coating, re-wrapping, re-threading or re-galvanizing of property that has previously been coated, wrapped, threaded or galvanized is considered to be a taxable repair service under R.S. 47:301(14)(g). Sales tax is due on the full amount charged for this service, including materials and labor. Taxes are due where the repair transaction is performed.

Bad Debts Refunds/ Paid Under Protest/ Refunds

Check Administrative for possible additional info. JW Power-court ruled Vendor could file refund on behalf of customer. Per Firestone Vs Calcasieu refunds for taxes paid in error due to question of fact or law must be paid under protest.

Contractor/ Contractor Tax Levy 90 Days/ Builder/ Agency Construction Agreement/ Immovable Contractor/ Real Property Contractor/ Tax Levy Grace Period/

Contractors enter into contracts for the construction, renovation, or repair (See "Repair" summary) of immovable properties, such as buildings, houses, roads, levees, pipelines, and industrial facilities. The term contractor shall not include businesses that fabricate or construct property that is sold to another person as tangible personal property, even though the property may be subsequently incorporated into the construction of an immovable. As a general rule, the contractor is treated as the ultimate consumer of materials incorporated into an immovable and is taxed on the purchase of those materials. Contractors must also pay sales and use tax on tools, equipment, and supplies purchased and used in their business. Tangible personal property purchased by contractors for contracts financed by Federal and State Government is taxable and the seller is required to collect from the contractor and remit the taxes due, unless an agency relationship exists with the federal or state government. Auditors should review the contracts between the contractor and the government agency to determine if an agency relationship is present. The La. Dept of Revenue form R-1020(11/04) is used to document these transactions. A designated contractor may not re-designate his subcontractors as authorized agents for the governmental entity. Each subcontractor must obtain its own designation from the governmental entity. Any materials purchased by the agent through the use of this certificate immediately become the property of the governmental entity upon delivery to the contractor/agent. La R.S. 47:337.18(C) states a nonresident contractor commencing work on any contract which in the aggregate exceeds $3000 shall: (a) Register with the Department of Revenue and obtain a certificate that identifies the construction project registered and report the total amount of the contract. (b) File a surety bond or a blanket surety bond for all contracts. (c) Register the contractor with the collector of sales and use taxes of the parish in which the contract is to be performed. An exemption from a new tax levy is available for lump-sum contracts entered into prior to the effective date of a new tax levy or within 90 days of the levy if the bid was submitted prior to the effective date. The exemption allows contractors to purchase materials at the prior tax levy rate. 47:305.11

Cost Price

Cost price means the actual cost of the articles of tangible personal property without any deductions on account of the cost of materials used, labor, or service cost, except those service costs for installing and delivering the articles of tangible personal property; if such installation and transportation costs are separately billed to the customer at the time of installation, or the reasonable market value of the tangible personal property at the time it becomes susceptible to the use tax, whichever is less. In the case of repairs performed outside the taxing jurisdiction and thereafter returned to the taxing jurisdiction, the cost price shall be the actual cost of any parts used in the repair, if applicable labor charges are separately stated on the invoice. If not separately stated, the cost price is the total amount of the invoice. The cost price is used to determine the use tax due.

Aggregates/Gravel/Dirt/ Hauling Dirt/ Sand

Dirt, gravel and sand that is severed from land is tangible personal property and therefore taxable. Separately stated delivery or hauling charges are not taxable. Haulers of dirt, gravel or sand that simply dumps their loads are selling tangible personal property and should not pay sales tax to their vendors, but should collect sales tax from their customers. If haulers of dirt, gravel or sand also spread the loads with additional equipment and manpower, and renders the dirt, gravel or sand immovable, the haulers should pay sales tax to their vendors and not charge sales tax to their customers.

Annual La 2nd Amendment Weekend Holiday/ Hunter's Exemption

EXEMPTION APPLIES TO STATE AND LOCAL §305.62. Exemption; Annual Louisiana Second Amendment Weekend Holiday A. This Act shall be known as the Annual Louisiana Second Amendment Weekend Holiday Act. B. Notwithstanding any other provisions of law to the contrary, the sales and use tax levied by the state of Louisiana and its political subdivisions shall not apply to the sales price or cost price of any consumer purchases of FIREARMS, AMMUNITION and OTHER HUNTING SUPPLIES that occur each calendar year on the first consecutive Friday through Sunday of September. *This only applies to purchases by consumers; purchases by businesses are not exempt. See the State' Declaration of Emergency Ruling issued 8/09 and RIB 09-024 for LIST OF EQUIPMENT that qualifies for the exemption from state and local tax.

Advance Tax

Effective January 1, 2009 advance sales tax was repealed by the State of Louisiana. Also prohibits local taxing authorities from collecting advance tax. RIB 09-015 Effective July 1, 2009 State will issue resale certificates to dealers depending on nature of business. Exemption certificate issued between Jan. 1, 2009 and June 30, 2009 and will not be valid after October 31, 2009. Prior to January 1, 2009 , unlike the State of Louisiana and Orleans Parish, the UTC does not provide for any credit for local taxes paid to a wholesale vendor. The UTC does provide that a purchase for resale to the final consumer may be exempt from local tax upon the presentation of a valid and executed resale exemption certificate.

Apheresis Kits/ Bone/ Blood Bank/ Cornea/ Human Organs/ Leuko Reduction Filters/ Organs/ Platelets/ Skin

Effective July 9, 1987, the term "sale at retail" does not include the sale of any human tissue transplants which are defined to include all human organs, bone, skin, cornea, blood, or blood products transplanted from one individual into another recipient individual, and such human tissue transplants are not taxable. Materials used directly in the collection of blood by nonprofit blood banks are excluded from the general sales tax. This includes materials used in the collection, separation, treatment , testing and storage of blood. 47:301(16)(j) Apheresis kits and leuko reduction filters used by nonprofit blood banks are exempt from the general sales tax. 47:301(16)(k)

Arts and Science Center/ Museum/ Planetarium/ Zoo

Effective September 3, 1989 Public and Public Non Profit museum admission charges are not subject to sales tax. Museums are defined to include art, history, aquariums, zoological park, botanical gardens, arboretums, nature centers, planetariums, and scientific museums.

Collect Tax/ Excess Tax/ Tax Collected/ Tax Received

Every dealer is required to make returns to the Collector of the total amount of the tax collected from his customers. In the cases where the total amount of taxes collected under the ordinances exceeds the percentage applicable to the particular transactions involved, any such excess must be remitted to the Collector. Failure to remit is a criminal offense. Claims for Refunds must be properly filed before they can be taken before the courts. Because the claim wasn't properly filed it prescribed. (See Clark vs State of La)

Certificate of Registration/Dealer/ Registration/ Registration Certificate/

Every person who is responsible for collecting and accounting for the tax or who engages in any business involving transactions for which tax is imposed under the local taxing ordinances shall apply for and obtain a certificate of registration from the Administrator/Director.

Agricultural Products/ Farm Diesel/ Catfish/ Crawfish/ Farm Equipment & Supplies/ Farm Fuels/ Farmer/ Farmer Livestock/ Feed and Seed/ Fertilizer/ Fruits/ Gardens/Grass Sod/ Homegrown Produce/ Livestock Pharmaceuticals/ Pesticides/ Poultry Production/ Produce Sales Farmer/ Seeds/ Sod/ Vegetables

Farm equipment, machinery, farm tools, and other items purchased by farmers for use or consumption are subject to tax unless specifically exempted. Specifically exempted from tax are purchases of fertilizer, containers used for farm products, feed and feed additives (47:305(A)(4)) purchased for the purpose of sustaining animals held primarily for commercial business or agricultural use, pesticides, seeds for use in the planting of crops, livestock, livestock products, and poultry products. Also exempt are farm, range, and agricultural products when produced by the farmer and used by him or members of his family. Sale of raw agriculture products (fruit, vegetables, grass sod, plants, etc.) livestock, cattle, poultry, etc. are not subject to sales/use tax when sold by the farmer that produced (grew) them. If anyone else besides the producer (grower) sells these items, they are subject to tax unless exempt for some other reason. The first $50,000 of new farm equipment used in poultry production is exempt from the state and local sales tax. 47:301(13)(c) The first $50,000 of qualified farm equipment is exempt from state sales tax. Review statute to determine the equipment eligible and the tax exemption rate. 47:305.25(A)(1) and (2) (Local option to exempt) Other exemptions: 47:301(16)(f) - Pharmaceuticals administered to livestock for agriculture purposes are not subject to sales/use tax. (state and local exemption) 47:305(A)(5) Materials used in the production of crawfish.(state only exemption) 47:305(A)(6) Materials used in the production of catfish. (state only exemption) 47:305.8 Agricultural use pesticides. (state and local exemption) 47:305.3 Seeds used by farmers. (state and local exemption) APPLIES TO PARISHES WITH POPULATIONS OF 120,000 - 140,000 ONLY: Allows farmers to purchase tax-free diesel, butane, propane and other liquefied petroleum gas for farm use. 47:305.37 (Rapides Parish) LOCAL OPTION: Pursuant to the authority provided for in R.S. 47:301(3)(i), (13)(k), or (28), or any combination of these or all of them, Provides political subdivisions with the option to provide an exclusion from its tax for any other machinery, equipment, supplies, materials, or services used or consumed in the business of farming. (see ACT 245 2007 Regular Session for eligibility requirements) Propane used in farm grain dryers constitutes materials and local taxing jurisdictions may exclude with local option. (AGO 09-0284)

Broadcasting Fees/ Radio Broadcasting Fees

Fees paid by radio and television broadcasters for the rights to broadcast copyrighted film, video, and tapes are not subject to sales/use tax. 47:305(F)

Chemical Dependency Unit/Hospital/ Mental Health Facility/ Nursing Home

Hospitals, chemical dependency units, and mental health facilities areprimarily engaged in the business of furnishing nontaxable services. However, they are consumers or users of all tangible personal property purchased for use or consumption in connection with the operation of the institution and sales of such tangible personal property to them are taxable. If a hospital, chemical dependency unit, or mental health facility operates any divisions that sell tangible personal property or taxable services, such as a pharmacy, pay parking facility, coffee shop, gift shop, and supplies of any nature, then the hospital, chemical dependency unit, or mental health facility becomes a dealer and must register, collect and remit tax upon all such sales. Hospitals that provide free care to all patients are excluded from the payment of sales tax on on the purchase, lease, rental of tangible personal property and the sales of services. 47:301 (7)(e), (10)(p), and (18)(c)

Attorney Fees

If any taxes, penalties, and interest due pursuant to statute and are referred to an attorney at law for collection, an additional charge for attorney fees in the amount of 10% percent of the taxes, penalties, and interest due shall be paid by the debtor. Act 493 2009 Regular Session: R.S. 47 337.13.1 With respect to amounts timely paid under protest, the amount paid to the attorney shall be subject to the discretion of the court...i.e. no longer will 10% attorney's fees be automatically awarded. R.S. 47:337.14 Also allows (other securities) to be posted in lieu of bond.

Computer Programs/ Canned Software/ Remotely Accessed Software/ Software/ Software Maintenance/ Upgrades

In October 1994 the La. Supreme Court ruled that computer software was tangible personal property and was taxable for sales/use tax purposes (City of New Orleans vs. South Central Bell Telephone). The court went on to say that certain maintenance agreements discussed in the trial on South Central Bell's software were not taxable. The court determined telephone support maintenance agreements are not taxable. However, maintenance agreements that provide upgraded software are taxable. Effective May 1, 1995 all sales of software, "canned" and custom-designed*, were determined to be taxable. *47:301(16)(h), (22), and (23) The State of Louisiana phased in an exemption for the sales of custom-designed software beginning in June 2003. An optional exemption is available to local political subdivisions to exempt the purchases of custom computer software. REPAIRS TO SOFTWARE If the software "source code", the actual program, is rewritten or modified to correct the problem, then the charge for this work is taxable as a repair service. If the software "source code" is designed to allow for changes in tables, variables or lists (ex. Changing FICA rates on payroll), then the charge for this service is not taxable BINGO SOFTWARE When a Distributor rents/leases video bingo equipment and the software to a Charity who in turns re-leases the equipment and software to a player, both transactions are taxable rental/leases. (RR 08-009 & RR 08-010) REMOTELY ACCESSED SOFTWARE RR 10-001 Discusses the taxability of electronically delivered products, including computer software and applications, stored media, remotely accessed software and entertainment media or products, to equipment located in La. NOTE: RIB 11-010 (May 2011) repealed the implementation of RR 10-001

Confidentiality/Privacy/ Public Records Law

La. R.S. 47:1508 relates to the confidentiality of tax records. Tax information is considered confidential and not subject to public review. Penalties for distributing confidential tax information shall be punished by imprisonment for not more than two years or fined not more than $10,000, or both. The Public Record Law La. R.S. 44:4 also covers the confidentiality of the tax audit information. Examples of confidential tax information: Tax remittance amounts, tax histories, any and all audit information, Insurance Premium Tax amounts, Occupational License amounts. Examples of public record tax information: Information that appears on the face of the license document itself. (example: taxpayer name, address, owner name, location, registration number) This applies to Sales/Use tax, Occupational License tax and Insurance Premium tax.

Common Carrier/Delivery/Drayage/ Third Party Delivery/ Vendor's Truck/

Law determines that sales/use tax is due where tangible personal property is delivered. If the purchaser picks up the tangible personal property the taxes are due where the property is picked up. If items are delivered by a common carrier and ear-marked for use in another jurisdiction, the taxes are due to the jurisdiction of use. If items are delivered in the vendor's truck, even if ear-marked for use in another taxing jurisdiction, the taxes are due to the jurisdiction of delivery. Delivery by the vendor's truck to the buyer's location makes this transaction a sales tax transaction. Separate charges for delivery to a lessor is not taxable to the lessee.

Warranty/ Extended Warranties/ Car Extended Warranty/ Maintenance Agreements/ Manufacturer's Warranty/ Service Contract/ Warranty

MANUFACTURER'S WARRANTY Merchandise repaired under a manufacturer's warranty is not subject to sales tax even if a third party performs the repair. Any deductibles or other charges to the customer are taxable unless exempted under some other provision of the law. EXTENDED WARRANTY & BREAKDOWN AGREEMENTS Car dealers and insurance companies often sell insurance polices insuring the major components of cars. These policies insure major components of cars after the manufacturer's warranty expires. These types of agreements are treated as an insurance policy and the premiums are not taxable. Any repairs made under this type of agreement (policy) are taxable. Repairs made by third parties are taxable for both parts and labor. If the car dealer receives the premium and owns the policy, then only parts would be taxable on a repair. (This is not a common occurrence, as most policies are underwritten by an insurance company). When computing the tax on repairs that include both manufacturers warranty work and extended warranty work, the parts and labor used for the extended warranty work must be separated from the parts and labor used for the manufacturers warranty work. If separated, manufacturers warranty work is not taxable but the extended warranty work is taxable. Failure to separate these repair charges will subject the entire repair bill to taxation. MAINTENANCE AGREEMENTS & SERVICE CONTRACTS Maintenance agreements may be purchased for specialized equipment or appliances that need servicing during the life of the property. These agreements can cover routine maintenance and adjustments and preventative maintenance. The amount paid for these maintenance agreements are subject to tax as a prepaid repair. Subsequent repairs to equipment under this agreement have already been taxed, therefore, no additional tax is due unless an additional charge is billed. The service company may purchase repair parts for resale.

Casual Sale/ Occasional Sale

Occasional and/or casual sales made by persons who are not engaged in the business of selling tangible personal property are not subject to tax. The exclusion of "occasional or casual" sales does not apply to the sale of motor vehicles nor to lease or rental transactions. The casual sales exclusion also applies to bulk sales transactions.

Clinic/ Doctor's Office/ Medical Clinic/ Physicians

Physicians, surgeons, and medical clinics are the consumers of tangible personal property which they use in the rendition of their professional services, and sales to them of such items are taxable. Tax does not apply to the fee for professional services rendered by physicians and surgeons. If physicians and surgeons make any retail sales to their patients, they must register as dealers and collect the tax on such sales.

Cafeteria Sales

Public school boards, high school boards, churches, hospitals, religious organizations, colleges, universities, or private schools operating lunch rooms, cafeterias or dining rooms for the exclusive purpose of providing only their respective students, members, staff, or patients with meals are deemed not to be engaged in the business of selling tangible personal property at retail and are not liable for payments of the sales tax with respect to such food products. When any cafeteria, lunch or dining room is available for use by the public, the school, hospital, college, church, university, or religious organization operating it is deemed to be in the business of selling tangible personal property at retail and is liable for the sales tax on the sale of such meals to the public. The School, hospital, college, church, university, or religious organization in this case may provide a resale certificate to its vendor for the purchase of the food but must accrue use tax on its monthly sales return on the cost price of the percentage of food provided to students or employees.

Biotechnology Companies

Purchases of new research equipment by a biotechnology company are exempt from the general sales tax.

Arbitration/ Mandatory Arbitration/

REPEALED by Board of Tax Appeals Legislation in 2014 A process by which parties to a local tax dispute submit evidence to a panel of arbitrators who conduct a hearing, receive evidence and arguments of the parties and issue a written decision which may or may not be final and subject to appeal. A mandatory Arbitration provision was enacted by the Louisiana Legislature in 2010 (Act 1003) and was to replace the initial hearing allowed under the provisions of RS 47:337.51(A) as well as provide a taxpayer with added recourse in those instances where the collector either denied a Claim for Refund or failed to act upon a properly submitted refund claim within a year of its submission to the Collector. A timely and properly completed request for mandatory Arbitration must be submitted to the Collector within 30 days of the Notice of Assessment or the determination that the Claim for Refund has been denied. Upon receipt of a request for Mandatory Arbitration, the Collector shall send notification to the Secretary of the Louisiana Department of Revenue and the Executive Director of the Louisiana Association of Tax Administrators. "Mandatory Arbitration" (MA) Only for assessments made under the provisions of 47:337.48(B) - (audit assessments and denied refunds) The bill eliminated the second administrative hearing (47:337.51) and set the time limits for the taxpayer to 30 days (previously 60 days) to select one of the following remedies: Pay the assessment Request mandatory arbitration (MA) Pay under protest and file suit or pay under protest and request MA Process: 1) Taxpayer must mail a timely, properly completed request for MA (30 days to request from date of audit assessment or 90 days from the date of refund denial) 2) Two arbitrators are chosen one by the taxpayer and by the collector within 10 days of notification of MA 3) These two selected arbitrators will select a third arbitrator. The three will select a Chief Arbitrator. 4) The Chief Arbitrator will request statements of facts and issues and give both parties 30 days to provide 5) Hearings may be held or decisions may be made based on statements provided. 6) Opinion must be rendered within 60 days 7) If the Taxpayer or Collector disagree with the arbitrator decision either party has 30 days to file a court petition 8) If the taxpayer is found to owe tax and said tax has not been paid under protest, then taxpayer must post a bond or pay the amount and file suit for recovery within 30 days of arbitrator decision. 9) The Taxpayer and the collector will share equally in the cost of MA

Casino/ Horse Racing/ Off-tracking Wagering Facilities/ Pari-mutuel Racetracks/ Race Horse/ Racetracks

Racetracks licensed by the Racing Commission are excluded from the payment of sales and use tax on the purchases of tangible personal property, services, and lease/rentals. The State admission/head tax is charged in lieu of sales tax. LA RS 4:168. Off-track wagering facilities licensed by the Racing Commission are excluded from the payment of sales and use tax on purchases of tangible personal property, services, and lease/rentals. LA RS 4:227 Casinos associated with Race Tracks are not exempt. See Boyd Racing v. Fruge and Harrah's v. Cynthia Bridges 47:305(A)(2) allows for the tax free sale of racehorses. The racetrack (horse racing/off-track betting) exclusion is limited by the legislature and does not extend to the purchases related to the taxpayer's slot gaming facility. (See Harrah's vs State)

Car Rental/ Coll Dam Waiver/ Car Warranty Rental/ Car Tax Collection/Credit for Tax Paid Autos/Auto Rental/Auto Tax Collection/Auto Warranty Rentals/ Motor Vehicle Lease:Rental/ Motor Vehicle Tax Collection/ Rental Car use tax/

Rental cars are subject to sales/use tax where the car is picked up. Other charges on the rental invoice are taxed as follows: Refueling Charge not taxable Insurance (LDW,PEI, LIS) taxable Drop Charges taxable Act 7 (HB 97) of 1996 excluded from local taxation automobiles purchased for rental purposes. Effective July 1, 1996. Also, Act 7 provides for a tax of 1/2% on the rental of automobiles for the benefit of local taxing authorities which will offset a part of the revenue loss from this legislation. Act 12 (SB 48) 1996 excludes from local taxation motor vehicles purchased for the purpose of leasing. (Effective July 1, 1996) 47:305.36 Not applicable after July 1, 2002 all lease rental property exempt 47:301(10)(a)(iii) Caddo vs La. Dept. of Motor Vehicles ruled that local governments have the right, if they so choose, to collect Motor Vehicle Tax directly from the automobile sellers. The Louisiana Dept. of Motor Vehicles currently collects these taxes for local government. The La. Dept of Motor Vehicles must give credit for local tax paid to other states. (Act 394 Regular Session 2005) COLLISION DAMAGE WAIVER: Collision Damage Waiver is properly includable as part of the gross proceeds derived from the lease or rental of an automobile because the CDW necessarily arises from the lease or rental of the automobile, can only be contracted for with the lessor of the automobile, and the language of La. Rev. Stat. 22:2091.10 expresses a clear legislative intent that CDW is subject to taxation. GROSS PROCEEDS The total charge "gross proceeds" for the lease is taxable. 47:306(A)(2) allows for cash basis reporting for lease/rental sales tax reporting and remittance. Separate charges for property tax, administrative charge, restocking charge, etc. are still considered taxable (they are pass-through charges, which become part of the selling price). 47:301(7)(j)(i) Exception: Separate charges for delivery to lessee is not taxable to the lessee. TAXING JURISDICTION FOR MOTOR VEHICLES: The lease or rental tax on automobiles shall be due to the jurisdiction where possession is transferred when the lease or rental period is less than 180 days. When the lease or rental period is greater than 180 days, the tax shall be due to the jurisdiction where the lessee resides (in the case of an individual) or the taxing jurisdiction where the official domicile of a business is located, unless the automobile is assigned, garaged, and used elsewhere. VEHCILES LEASED UNDER WARRANTY: Vehicle rentals for re-rent to warranty customers: Effective August 1, 1998, a licensed motor vehicle dealer who leases or rents a motor vehicle to their customer at no charge may waive the tax under the terms of the warranty agreement associated with the purchase. The waiver also extends to the work associated with an applicable warranty that has lapsed and the rental is provided at no charge. (Source exemption budget) 47:301(7)(h) (APPLIES TO STATE AND LOCAL TAXES)

Churches/ Sale of Catholic School Books/ Bibles/ Parochial School/ Private School Books/ Religious Institution/ Religious Materials/ School Fundraiser

Sales of tangible property to religious institutions or schools operated under their supervision are taxable. Effective July 1, 1996, Act 28 (HB104) excludes from taxation the purchase of bibles, song books, or literature used for religious instruction classes by churches and synagogues. An injunction was issued 4/17/06 barring the exemption. See RIB 06-022. THESE ITEMS ARE NO LONGER EXEMPT. Effective July 1, 1997, Act 15 (SB40) excludes from taxation fund raising sales, (must apply for and receive a certificate of eligibility from LDR, form R-1372), and the purchase, lease or rental of books, workbooks, computer, computer software, films, videos and audio tapes by approved parochial and private elementary and secondary schools. (APPLIES TO STATE AND LOCAL) Act 47 (HB99) extends Act 15 (SB40) through July 1, 2000. Act 206 2009 Regular Session deletes the termination date. The State of Louisiana exemption/exclusion form must be submitted to the State, and approved by the State prior to the local jurisdiction (city-parish) granting this exemption/exclusion. Certain educational materials and equipment used for classroom instruction are exempt from sales and use tax when purchased by an approved parochial and private elementary and secondary school. Materials include books, workbooks, computers, software, films, videos and audio tapes. 47:301(7)(f), (10)(q), and (18)(e)

Bed and Breakfast/ Cancellation Fees - Hotel/ Homeless Shelters/ Hotel/ Hotel Cancellation Fees/ Motel/ Occupancy Tax/ Permanent Guest/ Permanent Hotel Guest/ Room Reservation/ Sleeping Rooms

Sales tax is levied on the furnishing of sleeping rooms if the Hotel/Motel consists of 6 or more sleeping rooms and the occupant is a transient guest who rents the room for less than 60 consecutive days. Sales tax collected for the first 60 days are not refundable. ***This has been changed by State Regulation. *** After 1/1/06 tax is due unless a long term lease (1 year) is executed in advance and the room has full kitchen facilities. (La. Revenue Ruling 07-003) Rooms billed and paid directly by the state, local or federal governments are not subject to sales tax. Charitable organizations in general are not exempt from tax. A hotel/motel occupancy tax is levied on an establishment with 2 or more rooms. PRIOR TO 1/1/2006: The occupant must be a transient guest who rents the room for less than thirty (30) consecutive days. The tax does not apply (prior to 1/1/06) if the guest rents the room for more than 30 consecutive days, or if the rooms are rented on an annual contract basis, whether consecutive or not. Hotel/Motel taxes collected for the first 30 days are not refundable. Exception: If a contract prior to the beginning of the stay is executed for a period of time to exceed a 30 day stay. ****Amended by Act 60, 2005 eliminates the 30 day exemption, fully taxable beginning 1/1/06.**** RR 07-003 amends prior interpretations of La sales tax law and regulations applicable to occupancy of hotel rooms by transient guests, and the conditions necessary for a hotel room to be considered permanent and not transient for sales tax purposes. Supersedes RR No. 03-007. CAMP AND RETREAT FACLITIES Camp and retreat facilities owned and operated by nonprofit organizations exempt from federal income tax under Section 501(c)(3) are exempt from State and local sales tax. If a room rental is associated with the attendance of a function devoted to the nonprofit's purpose then the hotel tax is exempt also. 47:301(6)(b) Admission to places of amusements at camp and retreat facilities are exempt. 47:301(14)(b)(iv) If the retreat facility operates a restaurant then the sales of meals would not be included in this exemption and are not exempt. Act 377 (HB 639) 2005 regular session HOMELESS SHELTERS Act 456 2009 RS Removes certain temporary lodging facilities operated by nonprofit organizations for the housing of homeless transient persons from definition of hotels. APPLIES TO STATE AND LOCAL

Courier Services/ Expediting Charges/ Freight/ Freight In/ Hot Shot/ Inbound Freight/ Mobilization/ Shipping Charges/ Transportation Charges/ Trucking

Separately stated freight charges billed to a customer on sales invoices are not subject to tax. Freight charges for delivering a product from the manufacturer or wholesaler to a retail dealer are part of the retail dealer's cost and are included in the sales price of the product sold. Delivery charges made by concrete vendors using trucks are taxable because of specialized delivery requirements. Separate charges for delivery to a lessor is not taxable to the lessee.

College/ Community College/ Online College Instruction/ University

Solely for purposes of the payment of state sales or use tax the definition of "person" does not include "a regionally accredited independent institution of higher education that is a member of the Louisiana Association of Independent Colleges and Universities" when the purchase, lease, rental, or service obtained is directly related to the educational mission of the institution. However, the definition of "person" does include these institutions for the purposes of payment of the tax on sales by the institution if the sales are not otherwise exempt. For example, sales by the bookstore of t-shirts, sweatshirts, or mugs, even when they are emblazoned with the logo, are considered taxable sales. Also considered as taxable sales would be concession sales at events held at the university. Program sales (athletic programs sold at university events) would not be taxable. Electronic Education - Online courses only. Purchases made by private post secondary academic degree granting institutions are excluded from the general sales tax. Applies to textbooks and software

Carpet/Floorig

The collection of sales tax or the accrual of use tax on the sale and the installation of carpet or flooring may be handled in one of three ways: 1. The dealer can treat the transaction as a real property contract. The carpet or flooring dealer will purchase the materials (carpet, flooring materials, supplies, etc.) and pay sales tax or accrue use tax on the cost of the materials. The transaction with the customer will be considered a sale of immovable property and the sale will not be subject to sales tax. 2. The dealer can treat the transaction as a retail sale with the obligation to install. Title to the carpet or flooring passes in its movable state. If the dealer separates the installation charges from the carpet, tax is due on flooring and materials only, not on separately stated installation charges. 3. The dealer does not separate the installation charge. Therefore, the entire charge is considered a taxable retail sale.

Convenience Store/ Donut Shops/ Bakeries/Food Home Consumption/ Grocery Store/ Home Consumption of Food/Prepared Foods/ Single Serving Food Products/ Unprepared Food

The exemption must express applicability to local taxing jurisdictions. Food sold for preparation and consumption in the home includes by way of illustration but not limited to bakery products, dairy products, soft drinks, and packaged foods requiring further preparation by the purchaser. The purchaser of the food must also be the consumer for the exemption to apply. If a business purchases food products to give away as sales promotion or for other reasons, the exemption does not apply. Prepackaged manufactured single serving food products that are not classified for preparation and consumption in the home are exempt from state sales tax, and for local taxing jurisdictions the exemption is optional. Some examples of food products that qualify for the exemption or partial exemption are candy bars, chips, cookies, pies, milk, juices, individual bakery products, and bottled and canned soft drinks. In order for the single serving items to qualify for the exemption, they cannot be sold by any business or establishment that provides indoor or outdoor facilities for the on-site consumption of the items. Alcoholic beverages, malt beverages and beer, tobacco products, distilled water, carbonated water, ice, dry ice, water sold in containers, over-the-counter medicines, and dietary supplements are not considered to be food and are taxable at the full tax rate applicable for the state and the local taxing authority. Food products that are prepared by the seller of the food are taxable at the full state and local sales tax rate. Prepared food includes food products that are sold in a heated state, have been heated by the seller, are combinations of ingredients mixed or combined by the seller for sale as a single item, or sold with eating or drinking utensils supplied by the seller. Some examples of prepared food are seller-prepared sandwiches, iced drinks, cups of hot coffee or cocoa, beverages poured from fountains within the seller's facilities, and meats or seafood cooked by the seller regardless of size or quantity.

City Exempt/ Electric Cooperatives/ Exempt Organization/Parish Exempt/State Exempt

The following listing includes some of the organizations exempt from sales and use tax: - State, city and parish governmental departments and agencies, - Port Commissions, - Electric Cooperatives (i.e.,DEMCO), - Court Systems, - Federal Credit Unions, - Food Banks, - Greater Baton Rouge Airport District, - Louisiana Lottery Corporation, - Public Schools & School Boards, - Safety Council of Greater Baton Rouge, - State Universities, - District Attorneys, - Recreation and Parks Commissions (BREC), - Assessors, - Hospital service districts, and - Red Cross.

Coin Operated Machines/ Dry Cleaning/ Dyeing Services/ Laundromats/ Laundry/ Pressing Services/ Ship's Laundry/ Washateria/

The furnishing of laundry, cleaning, pressing, and dyeing services to fabric items are taxable. The operations of coin-operated washing or drying machines in a commercial laundromat, which is an establishment engaged solely in the business of furnishing washing or drying laundry services by means of coin-operated machines, are not taxable services. Laundry services performed for the owners or operators of such ships or vessels operating exclusively in foreign or interstate coastwise commerce (offshore), where the laundered articles are to be used in the course of the operation of such ships or vessels are exempt from state and local tax. All materials and supplies used while rendering cleaning services are taxable to the business providing the service. However, plastic bags, hangers, and fasteners, which will be delivered to the customer along with the articles laundered, cleaned, or pressed may be purchased with an exemption certificate. The Splish-Splash court case determined coin operated laundry machines receipts are not taxable. If a coin operated laundromat provides washing, drying and folding services to its customers, these services are taxable.

Country Club/ Fitness Club/ Health Club/ Physical Fitness Club/ Tanning Salons

The local taxing jurisdiction defines taxable sales to include dues, fees, or other consideration paid for the privilege of access to clubs, or access to use amusement, entertainment, athletic or recreational facilities. Country club dues fall within the definition of this section. Typical Transactions / Tax Status: Monthly Membership Fees / Taxable Initiation Fees / Taxable Capital Project Fees / Taxable Stock Sales / Not Taxable Retail Sales / Taxable Purchases (use tax) / Taxable Rental of Real Property / Not Taxable L.R.S. 47:303(F) provides for the collection of sales tax on membership fees in health and fitness clubs. According to the statute, the sales tax is due on contracts based on the amount paid each month, less any actual or imputed interest or collection fees or unpaid reserve amount not received by the club. RR 08-002 This Revenue Ruling addresses certain issues that may concern country clubs claiming a nonprofit or historical status for exemption from sales taxes, such as the taxability of the dues owed by members to the club, the taxability of certain activities of the club, particularly non-profit fundraising activities, and taxability of certain capital construction costs. Per RR08-002, these issues are taxable.

Archived Records/Records Required/ Records Retention/Retention/ Retention Period/ Sales Records/Tax Records

The local taxing ordinances require that every dealer keep and preserve suitable records of all taxable sales, purchases and sales of services under the ordinances, and such other books of account as may be necessary to determine the amount of tax due. Records must be kept for at least three calendar years, in addition to the current year. In cases of assessments, waivers of prescriptions and taxpayer fraud, records must be maintained for extended periods which will vary depending on circumstances. The failure to comply with these recordkeeping requirements is a criminal offense. You can refer to UTC 47:337.29 B and 47:337.30 B for more details.

Affiliated Company Transactions/ Intercompany Transactions / Related Party Transactions

The question of whether or not to pursue a sales/use or lease/rental tax will be determined by the factual circumstances involved. If two companies are "alter egos", although separate entities, they will not be liable for any tax on transactions between themselves. Subdivisions with separate staffs and budgets will be responsible for the taxes. Actual cases involve Hilton Hotels which had a wholly owned subsidiary that employed separate personnel. These personnel were paid from funds generated by the subsidiary. The subsidiary charged a 10% markup on transactions with the parent (Hilton Hotel). The transactions in this case were considered taxable by the courts. The Cajun Contractor case is different. Here the contractor set up a separate subsidiary for the sole purpose of purchasing equipment for the corporation. The subsidiary had no employees and no markups that existed on the sales to Cajun. The court determined that these transactions were not taxable. Questions used to determine the taxability of intercompany transactions are as follows: 1. Do the companies employ separate personnel? 2. Are the employees of each company paid out of separate funds? 3. Is a markup included in the transactions between the companies? 4. Are the companies separate legal entities? 5. Are the Board of Directors and owners different in each company?

Botox/ Chemotherapy/ Drugs/ Insulin/Medicare Part B and D/ Prescription Drugs

The sale of drugs, whether prescription or over the counter, is a taxable transaction at the local level. Some local governments have elected to exempt the sale of prescription drugs. Check with the local tax administrator for details. . INSURANCE COMPANY REIMBURSEMENT TO PHARMACY §337.11.1. Local sales and use tax; prescription drugs and pharmacist services; requirements: A. Upon the sale of prescription drugs and pharmacist services, a pharmacy or pharmacist shall be responsible for collecting any sales and use tax levied by a local political subdivision of this state and for remitting the amount of such tax to the levying authority. Health Insurance provider must pay taxes billed by the pharmacy. B. "Pharmacist services" means the filling and dispensing of prescription drugs or providing products and supplies, drug therapy, and other patient care services provided by a licensed pharmacist with the intent of achieving outcomes related to the cure, prevention, or management of a disease, elimination or reduction of a patient's symptoms, or arresting or slowing of a disease process. (Act 582 2008 Regular Session) INSULIN SALES Insulin sales do not qualify for the prescription drug exemption. These sales are taxed at the full local tax rate. NON-TAXABLE EXEMPTIONS: A. Pharmaceutical samples are exempt. B. "Express" prescription cards issued by pharmacies for a charge to users are not taxable. C. Prescription drugs covered by Medicare are also exempt from sales tax after July 5, 2001 when directly purchased by the patient. D. Dermal Fillers / Botox (Applies to State with local option) - Per RR 08-003, State considers Dermal Fillers as used to treat diseases and are not taxable at the state level

Contact Lenses/ Eye Doctor/ Eye Glasses/ Eye Surgery/Glasses/Lasik

The sale of prescription eyeglasses, corrective lenses and related accessories are not exempt from sales tax unless there is a specific local exemption. If the local exemption exists, it does not apply to nonprescription eyewear. Act 463 -2007 Legislative Session also exempts Eye Glasses and Contact Lens from STATE sales and use tax. If a lump sum bill is charged to the patient for professional services and corrective lenses or eyeglasses, then the eye doctor must accrue use tax on the cost price of the materials purchased. The lump sum invoice to the patient should not be taxed. Fees paid to the manufacturer of eye surgery equipment for the use of the patented procedures necessary to operate the machine are subject to sales or use tax. Patent license fees charged to operate the surgical equipment are taxable.

Containers/Packaging/ Pallets

The sale or purchase of containers and packaging items accompanying the products sold, for which there is no separate charge, is not subject to tax. These include bags, bottles, cans, labels, shrink wrap, seals, etc. PALLETS Pallets that do not go out with the final product are subject to use tax. HB 916 Act 419 Reg. Session 2007 provides a state and local sales tax exemption on the lease and or rental by manufacturers of pallets which are used in packaging products produced by the manufacturer. (manufacturer defined by NAICS sec. 31-33 dated 2002) This exclusion from state and local sales taxes became effective on July 1, 2008.

Cellular Phones/ Cellular Towers/ Mobile Phones

The sales of mobile telephone equipment, as well as repairs or service to the equipment, are taxable. Mobile telephone service is not taxable. The local taxing jurisdictions' position is that promotional sales of phones for less than fair market value ($1) are subject to use tax on the cost price of the phone. Credit will be given for any sales tax paid. The State of Louisiana is attempting to tax the commissions received from phone companies as part of the selling price of the cellular phone. This is being litigated with Campo's vs. State of Louisiana. Act 46 (HB 1750), effective May 23, 2003, changed how all political subdivisions within the state of Louisiana should tax the promotional sale of cellular telephones. The term "sales price" shall be the greater of the money actually received by the dealer from the purchaser at the point of sale or 25% of the dealer's cost of the cellular phone. For purposes of the determination of cost, the dealer's cost shall not include any amount received by the dealer from the purchaser for providing mobile telecommunication services, or any commissions, fees, rebates, activation charges, or other amounts received by the dealer from any source other than the purchaser. Cell Tower - other constructions will be treated as immovable property when permanently attached to land, regardless of the ownership of the land for sales and use tax administration purposes only. Sales tax will be owed on the acquisition prices of the materials for the construction of or for providing repairs to the property. 47:301(16)(l) Act 6, 2004 1st Ex. Session

Blade Sharpening/ Knife Sharpening/ Tool Sharpening

The sharpening of knives, saw blades, or tools of any nature is taxable.

Aerial Photography/ Photocopying/ Photofinishing/Photography/ Photostat/ Pictures/ Sitting Fees Photography/ Videographers

The total charges by a photographer for photographing events such as weddings, group gatherings, etc. are subject to tax. The same rules apply to videographers. Regulation: 88 Photofinishing involving the development of negatives and the printing of finished pictures is taxable. The tinting or coloring of photographs by a photofinisher constitutes a taxable fabrication. Chemicals used in the photofinishing process that are consumed by the photofinisher and do not become part of the final product are taxable. Any chemicals used that become part of the final product can be purchased with a resale exemption certificate for resale. Photostatting or photocopying is a taxable sale. The taxable chemicals are "bleach-fix" or fixing chemicals and stabilizers. The bleach is used to stop the developer's activity and it converts metallic silver into silver halide. The fixer converts silver halide into soluble silver complexes which are removed. The stabilizer stops the developing process. The developer chemical would be considered nontaxable as it becomes a part of the photo. Aerial photography is taxable. Aerial mapping services must be evaluated on a case by case basis. If actual aerial photos are sold and used as maps, the service is taxable. A sitting fee charged by a photographer is included in the selling price if the customer purchases photos. If the customer does not purchase any photos then the fee will not be taxable because a sale of tangible personal property has not occurred.

Bad Debts/ Uncollectible Accounts/ Write-Offs

To qualify for a refund for bad debt, the following must apply according to R.S. 47:337.34B(1-3) of the UTC: 1. Whenever the unpaid balance of an account due to the dealer for the purchase of tangible personal property or the sale of services subject to sales taxation has been found to be bad in accordance with Section 166 of the U.S. IRS Code and has actually been charged off for federal income tax purposes, the dealer shall be entitled to reimbursement of the amount of tax previously paid by the dealer on such amounts. 2. The prescription of such refund or credit shall begin to run from the date of signature on the federal income tax return charging off such debt. 3. Whenever the balance of an account that had been determined to be worthless and sales tax refunded is recovered at a later date, the payment shall be reported as a new sale in the month recovered for sales tax purposes. The credit or refund shall be granted whenever the Louisiana Dept. of Revenue has found the dealer to be entitled to reimbursement. It is the collector's duty to determine correct tax.

Bankruptcy/ Limited Liability Corporation/ LLC's

When a company goes bankrupt, sales taxes collected can be a personal liability of the officers of a corporation. Procedures are as follows 1. Notice of bankruptcy is given. 2. Proof of claim is filed by the collector. 3. Wait for results. Limited Liability Corporations are to be handled the same as corporations for bankruptcy purposes. When trustees, receivers, executors, and administrators by virtue of their appointment continue to operate, manage or control the business engaged in selling tangible personal property, they must remit the applicable tax on those transactions. This is their fiduciary responsibility. (SEE ALSO TRIALS TOPIC "FIDUCIARY")

Coupons/ Cigarette Buy Downs/ Manufacturers Coupons/ Manufacturers Rebate/ Rebates/ Tobacco Products Buy Downs/

When a customer presents a manufacturer's coupon to a retail dealer, which is redeemable by the retail dealer for the amount stated on the coupon, the sales tax should be charged on the "sales price" before the deduction of the coupon discount. When a retailer redeems a coupon that the retailer has issued, the retailer has lowered the "sales price" of the property or services. In such cases, the sales tax is calculated on the reduced amount after the allowance or the coupon discount. (Tax Topics January 1995) When a manufacturer's rebate is offered on a motor vehicle, the sales tax must be calculated on the sticker price less any discount or rebate given by the dealer himself. The manufacturer's rebate is applied prior to calculating the sales tax. Cigarette buy down programs are considered discounted sales and not taxable. The cigarette discounts are paid to retailer regardless of sales being made. Act 33 (HB160) excludes from tax tobacco product's buy downs by manufacturers and similar buy downs in other industries. The effective date of this Act was July 2, 1996.

Antique Shops/ Flea Market/ Leased Department/ Trade Fairs/ Trade Shows

When a store leases some of its departments to other persons for the selling of tangible personal property to consumers, each such leased department shall make separate monthly returns if the lessee keeps his own books and makes his own collections on account of sales at retail. If the store leasing such departments keeps the books for the leased departments and makes collections on account of their sales, the store shall, as an agent for the lessee, include in its tax returns all taxes due by the leased department, but the lessee shall not be relieved of liability in case the store fails to make the proper returns or fails to remit the taxes due.

Administrators/Executors/ Fiduciary/ Receiver/ Receiverships/ Trustees

When trustees, receivers, executors, and administrators by virtue of their appointment continue to operate, manage, or control the business engaged in selling tangible personal property at retail or selling services or leasing tangible personal property, they must remit the tax applicable to those transactions.

Auditor Contracts/Audit Cost/ Contract Auditor/ Third Party Audit/

Within limits provided in Article VII, Section 3(B) of the Constitution of Louisiana, for the purpose of auditing for compliance with local sales and use tax ordinances, any taxing authority may enter into a contract with a private auditing firm and, when so authorized by such contract, such firm may examine or investigate the records of any taxpayer. The private auditing firm shall be governed by the confidentiality requirements in La. R.S. 47:1508. Prior to initiating an examination or audit of a taxpayer, a taxing authority shall provide notice of the taxing authority's intent to audit by certified mail to the taxpayer at the taxpayer's last known address. Such notice shall: (a) Reasonably describe the nature of the audit. (b) Identify the name, office, address, and telephone number of the firm who will initiate the audit. (c) Advise the taxpayer of the right to review and copy the audit contract. (d) Summarize remedies available to contest the audit. (e) Describe the interest, penalties, and costs, including audit cost, for which the taxpayer may be liable. During the course of the audit, the taxpayer shall be notified of the name, office address, and office telephone number of each auditor assigned to the audit. Private auditing firms shall provide any taxpayer subject to an audit with access to an original or a copy of the audit contract specifying the terms under which the audit firm was engaged, which may be reviewed and copied by the taxpayer. If the cost is borne by the taxpayer, the cost shall not exceed 30% of the additional taxes determined to be due. The Attorney General Opinion No. 97-412 dated November 12, 1997, states the requirements only apply to private auditing firms. The requirements do not apply to local government employed auditors.