Lawmaker: 99 percent of people don't pay online sales tax
BATON ROUGE – A lawmaker is hoping to tackle a growing $808 million loss in tax revenue due to sales being made online.
People are not paying the taxes on out-of-state purchases made online. Buyers are supposed to report online purchases each year on tax returns.
“You're legally required to put your vendor purchases on your Louisiana return. If you're not doing that, like I think 99 percent of people aren't, you're actually breaking the law,” Rep. Julie Stokes (R-Kenner) said.
Stokes chairs a committee that is working to revamp the state's sales tax code. She believes changing the online tax rules would help fill the state's $1 billion budget hole.
Purchasing from out-of-state vendors technically falls under federal regulations, and currently there are several bills slowly making their way through Congress that would help states enforce sales tax laws.
"It would make it easier to comply with the law, because the taxes would be taken out at the time of the purchase," said Stokes.
There is also a concern the current system creates an unfair market advantage for "brick and mortar" retailers who have no choice but to charge sales tax, and therefore a higher price at the time of purchase.