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Tax Alert

Tim Barfield, Executive Counsel to the Louisiana Department of Revenue, provided a draft of Governor Jindal’s tax reform bill to the Louisiana House Ways and Means Committee on March 19, 2019. The bill is scheduled to be introduced in the Legislative Session which opens April 8.The bill is already receiving opposition from parties ranging from various advocacy groups, local governments, business leagues, and religious leaders so it is unlikely that the bill will make it through in its present form, if it makes it all. (Indeed the opposition to the bill is so strong at this point that there is already talk about the Governor convening a special session to take up tax reform.) We will update you as changes occur. The purpose of this bulletin is to alert you of the proposed tax changes so that you may anticipate how the bill may affect you and your business.

The proposed changes are to:

  1. Repeal individual income tax which represents a significant portion of the state’s revenue.
  2. Repeal the corporate income and franchise tax. This change is presently in HB 178, but the Administration’s version is coming.
  3. Increase the state sales and use tax rate from 4% to 5.88%.
  4. Broaden the state (but not the local) sales and use tax to include services which are not currently taxed., “Service”is defined as “all activities engaged in for other person, natural or juridical, for a fee, retainer, commission, or other monetary charge or consideration, which involve predominantly the performance of a service as distinguished from the selling of property.”
  5.  Repeal certain sales and use tax exemptions.

To determine the impact of the Governor’s proposal you should consider every transaction you or your business enter into If those transactions are listed as a taxable service or are not among the exempt transactions set out below then , you will be required to pay or collect and remit tax on those services and transactions. Remember, that under the bill, a service is taxable even if that service was not the principal reason for you entering into a transaction. 

Proposed Taxable Services:

All Services, unless specifically exempted. However the Department has provided a “target”list of services to be taxed.

Category

 

Name

Mining

213113+

Support services for other mining

Transportation

 

Transit and ground passenger transportation services

487 + 488

Scenic and sightseeing transportation services and support activities for transportation

492

Couriers and messengers services

Professional Services

5412

Accounting, tax preparation, bookkeeping, and payroll services

5413

Architectural, engineering, and related services

5414

Specialized design services

541511

Custom computer programming services

541512

Computer systems design services

541513

Other computer related services, including facilities management

54161

Management, scientific, and technical consulting services

54162+9

Environmental and other technical consulting services

5417

Scientific research and development services

 

Advertising related services

54192

Photographic Services

54194

Veterinary services

54199

All other miscellaneous professional, scientific, and technical services

Business Services

5613

Employment services

5615

Travel arrangement and reservation services

5611

Office administrative services

5612

Facilities support services

5614

Business support services

5616

Investigation and security services

5617

Services to buildings and dwellings

5619

Other support services

562

Waste management and remediation services

Information

5152

Cable and other subscription services

518

Data processing-hosting ISP-web search portals

519

Other information services

Financial Services

52429

Insurance related support services

Entertainment

7111

Performing arts

7113

Promotional services for performing arts and sports and public figures

7115

Independent artists, writers, and performers

712

Museum, heritage, zoo, and recreational services

Personal Services

8121

Personal care services

8129

Other personal services

 

Proposed Nontaxable Services:

(1)  Services already taxed will not be subject to the state’s 5.88% rate, but will instead to continue to be taxed at the old state rate, 4%, and local sales tax rate. Therefore, the following are exempt from the additional tax under the proposal:

a.      Furnishing of hotel rooms,
a.      Sale of admissions to certain events,
b.     Furnishing parking facilities,
c.      Certain printing services,
d.     The furnishing of cleaning or storage services for clothes, furs, rugs, and the like,
e.      Furnishing of cold storage, and,
f.       Repairing tangible personal property:

(2)  Services performed by an employee for his employer are not taxable.

(3)  Services performed directly for the state, a political subdivision of the state, the United States government, or the agencies of the United States government are not taxable.

(4)  Purchases and resales of advertising time or space from media outlets.

(5)  The following services enumerated in the North American Industrial Classification System, 2007, as prepared by the Statistical Policy Division of the Office of Management and Budget, Office of the President shall be exempt fr

Tax Alert

Tim Barfield, Executive Counsel to the Louisiana Department of Revenue, provided a draft of Governor Jindal’s tax reform bill to the Louisiana House Ways and Means Committee on March 19, 2019. The bill is scheduled to be introduced in the Legislative Session which opens April 8.The bill is already receiving opposition from parties ranging from various advocacy groups, local governments, business leagues, and religious leaders so it is unlikely that the bill will make it through in its present form, if it makes it all. (Indeed the opposition to the bill is so strong at this point that there is already talk about the Governor convening a special session to take up tax reform.) We will update you as changes occur. The purpose of this bulletin is to alert you of the proposed tax changes so that you may anticipate how the bill may affect you and your business.

The proposed changes are to:

  1. Repeal individual income tax which represents a significant portion of the state’s revenue.
  2. Repeal the corporate income and franchise tax. This change is presently in HB 178, but the Administration’s version is coming.
  3. Increase the state sales and use tax rate from 4% to 5.88%.
  4. Broaden the state (but not the local) sales and use tax to include services which are not currently taxed., “Service”is defined as “all activities engaged in for other person, natural or juridical, for a fee, retainer, commission, or other monetary charge or consideration, which involve predominantly the performance of a service as distinguished from the selling of property.”
  5.  Repeal certain sales and use tax exemptions.

To determine the impact of the Governor’s proposal you should consider every transaction you or your business enter into If those transactions are listed as a taxable service or are not among the exempt transactions set out below then , you will be required to pay or collect and remit tax on those services and transactions. Remember, that under the bill, a service is taxable even if that service was not the principal reason for you entering into a transaction. 

Proposed Taxable Services:

All Services, unless specifically exempted. However the Department has provided a “target”list of services to be taxed.

Category

 

Name

Mining

213113+

Support services for other mining

Transportation

 

Transit and ground passenger transportation services

487 + 488

Scenic and sightseeing transportation services and support activities for transportation

492

Couriers and messengers services

Professional Services

5412

Accounting, tax preparation, bookkeeping, and payroll services

5413

Architectural, engineering, and related services

5414

Specialized design services

541511

Custom computer programming services

541512

Computer systems design services

541513

Other computer related services, including facilities management

54161

Management, scientific, and technical consulting services

54162+9

Environmental and other technical consulting services

5417

Scientific research and development services

 

Advertising related services

54192

Photographic Services

54194

Veterinary services

54199

All other miscellaneous professional, scientific, and technical services

Business Services

5613

Employment services

5615

Travel arrangement and reservation services

5611

Office administrative services

5612

Facilities support services

5614

Business support services

5616

Investigation and security services

5617

Services to buildings and dwellings

5619

Other support services

562

Waste management and remediation services

Information

5152

Cable and other subscription services

518

Data processing-hosting ISP-web search portals

519

Other information services

Financial Services

52429

Insurance related support services

Entertainment

7111

Performing arts

7113

Promotional services for performing arts and sports and public figures

7115

Independent artists, writers, and performers

712

Museum, heritage, zoo, and recreational services

Personal Services

8121

Personal care services

8129

Other personal services

 

Proposed Nontaxable Services:

(1)  Services already taxed will not be subject to the state’s 5.88% rate, but will instead to continue to be taxed at the old state rate, 4%, and local sales tax rate. Therefore, the following are exempt from the additional tax under the proposal:

a.      Furnishing of hotel rooms,
a.      Sale of admissions to certain events,
b.     Furnishing parking facilities,
c.      Certain printing services,
d.     The furnishing of cleaning or storage services for clothes, furs, rugs, and the like,
e.      Furnishing of cold storage, and,
f.       Repairing tangible personal property:

(2)  Services performed by an employee for his employer are not taxable.

(3)  Services performed directly for the state, a political subdivision of the state, the United States government, or the agencies of the United States government are not taxable.

(4)  Purchases and resales of advertising time or space from media outlets.

(5)  The following services enumerated in the North American Industrial Classification System, 2007, as prepared by the Statistical Policy Division of the Office of Management and Budget, Office of the President shall be exempt fr

Tax Alert

Tim Barfield, Executive Counsel to the Louisiana Department of Revenue, provided a draft of Governor Jindal’s tax reform bill to the Louisiana House Ways and Means Committee on March 19, 2019. The bill is scheduled to be introduced in the Legislative Session which opens April 8.The bill is already receiving opposition from parties ranging from various advocacy groups, local governments, business leagues, and religious leaders so it is unlikely that the bill will make it through in its present form, if it makes it all. (Indeed the opposition to the bill is so strong at this point that there is already talk about the Governor convening a special session to take up tax reform.) We will update you as changes occur. The purpose of this bulletin is to alert you of the proposed tax changes so that you may anticipate how the bill may affect you and your business.

The proposed changes are to:

  1. Repeal individual income tax which represents a significant portion of the state’s revenue.
  2. Repeal the corporate income and franchise tax. This change is presently in HB 178, but the Administration’s version is coming.
  3. Increase the state sales and use tax rate from 4% to 5.88%.
  4. Broaden the state (but not the local) sales and use tax to include services which are not currently taxed., “Service”is defined as “all activities engaged in for other person, natural or juridical, for a fee, retainer, commission, or other monetary charge or consideration, which involve predominantly the performance of a service as distinguished from the selling of property.”
  5.  Repeal certain sales and use tax exemptions.

To determine the impact of the Governor’s proposal you should consider every transaction you or your business enter into If those transactions are listed as a taxable service or are not among the exempt transactions set out below then , you will be required to pay or collect and remit tax on those services and transactions. Remember, that under the bill, a service is taxable even if that service was not the principal reason for you entering into a transaction. 

Proposed Taxable Services:

All Services, unless specifically exempted. However the Department has provided a “target”list of services to be taxed.

Category

 

Name

Mining

213113+

Support services for other mining

Transportation

 

Transit and ground passenger transportation services

487 + 488

Scenic and sightseeing transportation services and support activities for transportation

492

Couriers and messengers services

Professional Services

5412

Accounting, tax preparation, bookkeeping, and payroll services

5413

Architectural, engineering, and related services

5414

Specialized design services

541511

Custom computer programming services

541512

Computer systems design services

541513

Other computer related services, including facilities management

54161

Management, scientific, and technical consulting services

54162+9

Environmental and other technical consulting services

5417

Scientific research and development services

 

Advertising related services

54192

Photographic Services

54194

Veterinary services

54199

All other miscellaneous professional, scientific, and technical services

Business Services

5613

Employment services

5615

Travel arrangement and reservation services

5611

Office administrative services

5612

Facilities support services

5614

Business support services

5616

Investigation and security services

5617

Services to buildings and dwellings

5619

Other support services

562

Waste management and remediation services

Information

5152

Cable and other subscription services

518

Data processing-hosting ISP-web search portals

519

Other information services

Financial Services

52429

Insurance related support services

Entertainment

7111

Performing arts

7113

Promotional services for performing arts and sports and public figures

7115

Independent artists, writers, and performers

712

Museum, heritage, zoo, and recreational services

Personal Services

8121

Personal care services

8129

Other personal services

 

Proposed Nontaxable Services:

(1)  Services already taxed will not be subject to the state’s 5.88% rate, but will instead to continue to be taxed at the old state rate, 4%, and local sales tax rate. Therefore, the following are exempt from the additional tax under the proposal:

a.      Furnishing of hotel rooms,
a.      Sale of admissions to certain events,
b.     Furnishing parking facilities,
c.      Certain printing services,
d.     The furnishing of cleaning or storage services for clothes, furs, rugs, and the like,
e.      Furnishing of cold storage, and,
f.       Repairing tangible personal property:

(2)  Services performed by an employee for his employer are not taxable.

(3)  Services performed directly for the state, a political subdivision of the state, the United States government, or the agencies of the United States government are not taxable.

(4)  Purchases and resales of advertising time or space from media outlets.

(5)  The following services enumerated in the North American Industrial Classification System, 2007, as prepared by the Statistical Policy Division of the Office of Management and Budget, Office of the President shall be exempt fr

Tax Alert

Tim Barfield, Executive Counsel to the Louisiana Department of Revenue, provided a draft of Governor Jindal’s tax reform bill to the Louisiana House Ways and Means Committee on March 19, 2019. The bill is scheduled to be introduced in the Legislative Session which opens April 8.The bill is already receiving opposition from parties ranging from various advocacy groups, local governments, business leagues, and religious leaders so it is unlikely that the bill will make it through in its present form, if it makes it all. (Indeed the opposition to the bill is so strong at this point that there is already talk about the Governor convening a special session to take up tax reform.) We will update you as changes occur. The purpose of this bulletin is to alert you of the proposed tax changes so that you may anticipate how the bill may affect you and your business.

The proposed changes are to:

  1. Repeal individual income tax which represents a significant portion of the state’s revenue.
  2. Repeal the corporate income and franchise tax. This change is presently in HB 178, but the Administration’s version is coming.
  3. Increase the state sales and use tax rate from 4% to 5.88%.
  4. Broaden the state (but not the local) sales and use tax to include services which are not currently taxed., “Service”is defined as “all activities engaged in for other person, natural or juridical, for a fee, retainer, commission, or other monetary charge or consideration, which involve predominantly the performance of a service as distinguished from the selling of property.”
  5.  Repeal certain sales and use tax exemptions.

To determine the impact of the Governor’s proposal you should consider every transaction you or your business enter into If those transactions are listed as a taxable service or are not among the exempt transactions set out below then , you will be required to pay or collect and remit tax on those services and transactions. Remember, that under the bill, a service is taxable even if that service was not the principal reason for you entering into a transaction. 

Proposed Taxable Services:

All Services, unless specifically exempted. However the Department has provided a “target”list of services to be taxed.

Category

 

Name

Mining

213113+

Support services for other mining

Transportation

 

Transit and ground passenger transportation services

487 + 488

Scenic and sightseeing transportation services and support activities for transportation

492

Couriers and messengers services

Professional Services

5412

Accounting, tax preparation, bookkeeping, and payroll services

5413

Architectural, engineering, and related services

5414

Specialized design services

541511

Custom computer programming services

541512

Computer systems design services

541513

Other computer related services, including facilities management

54161

Management, scientific, and technical consulting services

54162+9

Environmental and other technical consulting services

5417

Scientific research and development services

 

Advertising related services

54192

Photographic Services

54194

Veterinary services

54199

All other miscellaneous professional, scientific, and technical services

Business Services

5613

Employment services

5615

Travel arrangement and reservation services

5611

Office administrative services

5612

Facilities support services

5614

Business support services

5616

Investigation and security services

5617

Services to buildings and dwellings

5619

Other support services

562

Waste management and remediation services

Information

5152

Cable and other subscription services

518

Data processing-hosting ISP-web search portals

519

Other information services

Financial Services

52429

Insurance related support services

Entertainment

7111

Performing arts

7113

Promotional services for performing arts and sports and public figures

7115

Independent artists, writers, and performers

712

Museum, heritage, zoo, and recreational services

Personal Services

8121

Personal care services

8129

Other personal services

 

Proposed Nontaxable Services:

(1)  Services already taxed will not be subject to the state’s 5.88% rate, but will instead to continue to be taxed at the old state rate, 4%, and local sales tax rate. Therefore, the following are exempt from the additional tax under the proposal:

a.      Furnishing of hotel rooms,
a.      Sale of admissions to certain events,
b.     Furnishing parking facilities,
c.      Certain printing services,
d.     The furnishing of cleaning or storage services for clothes, furs, rugs, and the like,
e.      Furnishing of cold storage, and,
f.       Repairing tangible personal property:

(2)  Services performed by an employee for his employer are not taxable.

(3)  Services performed directly for the state, a political subdivision of the state, the United States government, or the agencies of the United States government are not taxable.

(4)  Purchases and resales of advertising time or space from media outlets.

(5)  The following services enumerated in the North American Industrial Classification System, 2007, as prepared by the Statistical Policy Division of the Office of Management and Budget, Office of the President shall be exempt fr

Tax Alert

Tim Barfield, Executive Counsel to the Louisiana Department of Revenue, provided a draft of Governor Jindal’s tax reform bill to the Louisiana House Ways and Means Committee on March 19, 2019. The bill is scheduled to be introduced in the Legislative Session which opens April 8.The bill is already receiving opposition from parties ranging from various advocacy groups, local governments, business leagues, and religious leaders so it is unlikely that the bill will make it through in its present form, if it makes it all. (Indeed the opposition to the bill is so strong at this point that there is already talk about the Governor convening a special session to take up tax reform.) We will update you as changes occur. The purpose of this bulletin is to alert you of the proposed tax changes so that you may anticipate how the bill may affect you and your business.

The proposed changes are to:

  1. Repeal individual income tax which represents a significant portion of the state’s revenue.
  2. Repeal the corporate income and franchise tax. This change is presently in HB 178, but the Administration’s version is coming.
  3. Increase the state sales and use tax rate from 4% to 5.88%.
  4. Broaden the state (but not the local) sales and use tax to include services which are not currently taxed., “Service”is defined as “all activities engaged in for other person, natural or juridical, for a fee, retainer, commission, or other monetary charge or consideration, which involve predominantly the performance of a service as distinguished from the selling of property.”
  5.  Repeal certain sales and use tax exemptions.

To determine the impact of the Governor’s proposal you should consider every transaction you or your business enter into If those transactions are listed as a taxable service or are not among the exempt transactions set out below then , you will be required to pay or collect and remit tax on those services and transactions. Remember, that under the bill, a service is taxable even if that service was not the principal reason for you entering into a transaction. 

Proposed Taxable Services:

All Services, unless specifically exempted. However the Department has provided a “target”list of services to be taxed.

Category

 

Name

Mining

213113+

Support services for other mining

Transportation

 

Transit and ground passenger transportation services

487 + 488

Scenic and sightseeing transportation services and support activities for transportation

492

Couriers and messengers services

Professional Services

5412

Accounting, tax preparation, bookkeeping, and payroll services

5413

Architectural, engineering, and related services

5414

Specialized design services

541511

Custom computer programming services

541512

Computer systems design services

541513

Other computer related services, including facilities management

54161

Management, scientific, and technical consulting services

54162+9

Environmental and other technical consulting services

5417

Scientific research and development services

 

Advertising related services

54192

Photographic Services

54194

Veterinary services

54199

All other miscellaneous professional, scientific, and technical services

Business Services

5613

Employment services

5615

Travel arrangement and reservation services

5611

Office administrative services

5612

Facilities support services

5614

Business support services

5616

Investigation and security services

5617

Services to buildings and dwellings

5619

Other support services

562

Waste management and remediation services

Information

5152

Cable and other subscription services

518

Data processing-hosting ISP-web search portals

519

Other information services

Financial Services

52429

Insurance related support services

Entertainment

7111

Performing arts

7113

Promotional services for performing arts and sports and public figures

7115

Independent artists, writers, and performers

712

Museum, heritage, zoo, and recreational services

Personal Services

8121

Personal care services

8129

Other personal services

 

Proposed Nontaxable Services:

(1)  Services already taxed will not be subject to the state’s 5.88% rate, but will instead to continue to be taxed at the old state rate, 4%, and local sales tax rate. Therefore, the following are exempt from the additional tax under the proposal:

a.      Furnishing of hotel rooms,
a.      Sale of admissions to certain events,
b.     Furnishing parking facilities,
c.      Certain printing services,
d.     The furnishing of cleaning or storage services for clothes, furs, rugs, and the like,
e.      Furnishing of cold storage, and,
f.       Repairing tangible personal property:

(2)  Services performed by an employee for his employer are not taxable.

(3)  Services performed directly for the state, a political subdivision of the state, the United States government, or the agencies of the United States government are not taxable.

(4)  Purchases and resales of advertising time or space from media outlets.

(5)  The following services enumerated in the North American Industrial Classification System, 2007, as prepared by the Statistical Policy Division of the Office of Management and Budget, Office of the President shall be exempt fr

Tax Alert

Tim Barfield, Executive Counsel to the Louisiana Department of Revenue, provided a draft of Governor Jindal’s tax reform bill to the Louisiana House Ways and Means Committee on March 19, 2019. The bill is scheduled to be introduced in the Legislative Session which opens April 8.The bill is already receiving opposition from parties ranging from various advocacy groups, local governments, business leagues, and religious leaders so it is unlikely that the bill will make it through in its present form, if it makes it all. (Indeed the opposition to the bill is so strong at this point that there is already talk about the Governor convening a special session to take up tax reform.) We will update you as changes occur. The purpose of this bulletin is to alert you of the proposed tax changes so that you may anticipate how the bill may affect you and your business.

The proposed changes are to:

  1. Repeal individual income tax which represents a significant portion of the state’s revenue.
  2. Repeal the corporate income and franchise tax. This change is presently in HB 178, but the Administration’s version is coming.
  3. Increase the state sales and use tax rate from 4% to 5.88%.
  4. Broaden the state (but not the local) sales and use tax to include services which are not currently taxed., “Service”is defined as “all activities engaged in for other person, natural or juridical, for a fee, retainer, commission, or other monetary charge or consideration, which involve predominantly the performance of a service as distinguished from the selling of property.”
  5.  Repeal certain sales and use tax exemptions.

To determine the impact of the Governor’s proposal you should consider every transaction you or your business enter into If those transactions are listed as a taxable service or are not among the exempt transactions set out below then , you will be required to pay or collect and remit tax on those services and transactions. Remember, that under the bill, a service is taxable even if that service was not the principal reason for you entering into a transaction. 

Proposed Taxable Services:

All Services, unless specifically exempted. However the Department has provided a “target”list of services to be taxed.

Category

 

Name

Mining

213113+

Support services for other mining

Transportation

 

Transit and ground passenger transportation services

487 + 488

Scenic and sightseeing transportation services and support activities for transportation

492

Couriers and messengers services

Professional Services

5412

Accounting, tax preparation, bookkeeping, and payroll services

5413

Architectural, engineering, and related services

5414

Specialized design services

541511

Custom computer programming services

541512

Computer systems design services

541513

Other computer related services, including facilities management

54161

Management, scientific, and technical consulting services

54162+9

Environmental and other technical consulting services

5417

Scientific research and development services

 

Advertising related services

54192

Photographic Services

54194

Veterinary services

54199

All other miscellaneous professional, scientific, and technical services

Business Services

5613

Employment services

5615

Travel arrangement and reservation services

5611

Office administrative services

5612

Facilities support services

5614

Business support services

5616

Investigation and security services

5617

Services to buildings and dwellings

5619

Other support services

562

Waste management and remediation services

Information

5152

Cable and other subscription services

518

Data processing-hosting ISP-web search portals

519

Other information services

Financial Services

52429

Insurance related support services

Entertainment

7111

Performing arts

7113

Promotional services for performing arts and sports and public figures

7115

Independent artists, writers, and performers

712

Museum, heritage, zoo, and recreational services

Personal Services

8121

Personal care services

8129

Other personal services

 

Proposed Nontaxable Services:

(1)  Services already taxed will not be subject to the state’s 5.88% rate, but will instead to continue to be taxed at the old state rate, 4%, and local sales tax rate. Therefore, the following are exempt from the additional tax under the proposal:

a.      Furnishing of hotel rooms,
a.      Sale of admissions to certain events,
b.     Furnishing parking facilities,
c.      Certain printing services,
d.     The furnishing of cleaning or storage services for clothes, furs, rugs, and the like,
e.      Furnishing of cold storage, and,
f.       Repairing tangible personal property:

(2)  Services performed by an employee for his employer are not taxable.

(3)  Services performed directly for the state, a political subdivision of the state, the United States government, or the agencies of the United States government are not taxable.

(4)  Purchases and resales of advertising time or space from media outlets.

(5)  The following services enumerated in the North American Industrial Classification System, 2007, as prepared by the Statistical Policy Division of the Office of Management and Budget, Office of the President shall be exempt fr

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