Soon Red River Parish residents may be getting notices that they owe tax on purchases they thought were tax free. Notices may come by mail or to your email. You could be taxed on purchases made online or from catalogs. These purchases have traditionally been free of Louisiana sales taxes.
The Legislature in 2016 passed a law to require “remote retailers” to notify purchasers that Louisiana Use Tax may be due. This is the time those notices are being sent to purchasers.
The Journal asked Elaine Moore of the Red River Parish Sales Tax agency about the use tax. She told us it is the same as sales tax and is tax on purchases on which no sales tax had been collected at the time of purchase. Moore said her office did not have a break down of how much of the sales tax they collect resulted from online or catalog sales.
Individuals receiving such notices of tax due should file it with their Louisiana income tax return or a Consumer Use Tax Return form R-1035. And include payment with other taxes due the state. The forms are available from the state revenue department at http://www.revenue.louisiana.gov/forms.
The legislature acted in 2016 due to the shift in buying patterns away from traditional brick-and-mortar stores toward online purchases. Today online purchases are a significant portion of retail purchases. And many people began buying online because of the tax savings. Louisiana’s state sales tax is 4 percent plus the local sales tax could add another 7 percent depending upon where the purchase is made. On a $1,000 purchase, sales tax of 11 percent represents an additional $110 the buyer has to pay.