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By Ed Ben, Senior Director, State & Local Tax | July 2, 2020

The governor of Louisiana signed Senate Bill 138 into law on June 11, 2020. This bill requires that, as of July 1, 2020, marketplace facilitators register with the State no later than 30 days after they meet or exceed specified economic nexus thresholds in the current or previous year. 

The specified thresholds are:

  1. $100,000 in gross revenue derived from sales to tangible personal property, electronically delivered products or services delivered into the state or;
  2. 200 separate transactions relating to tangible personal property, products transferred electronically, or services sold for delivery into the state.

Taxpayers who do not meet either threshold will also be able to voluntarily register and collect the appropriate taxes per LA Rev. Stat. Ann. §47:302(K)(5) and LA Rev. Stat. Ann. §47:301(4).

With the passage of Senate Bill 138, the definition of a dealer will now include marketplace facilitators under the broader term of remote seller. A “remote seller” is defined as a seller who sells for sale at retail, use, consumption, distribution, or for storage to be used for consumption or distribution any taxable tangible personal property, products transferred electronically, or services for delivery within Louisiana, but does not have a physical presence in Louisiana.   

A “marketplace facilitator” is any person that facilitates a sale for a marketplace seller through a marketplace owned, operated, or otherwise controlled by the person, by any of the following activities:

  1. Offering for sale through any means, by a marketplace seller, tangible personal property or sales of services for delivery into Louisiana; or  
  2. Collecting payment from the purchaser and transmitting all or part of the payment to the marketplace seller, regardless of whether the person receives compensation or other consideration in exchange for facilitating the sale.  

The marketplace facilitator will ultimately be responsible for determining the taxability of the sale and collecting and remitting all state and local sales taxes unless the marketplace seller does not provide sufficient information that allows for the proper determination of tax. In addition, there is no prohibition on the marketplace facilitator and marketplace seller from entering a contract that allows the marketplace seller to collect and remit all applicable taxes if the contract meets specific requirements mandated by the state. 

A marketplace facilitator will have no later than 30 days after meeting either of the economic nexus thresholds to register with the state and obtain approval to collect the state and local sales and use tax on their remote sales for delivery into Louisiana. Once approved, the marketplace facilitator will begin collecting the state and local taxes no later than 60 days after meeting either economic nexus threshold. Louisiana generally requires a return to be filed and paid monthly on or before the 20th of the month following the preceding collection month. 

 Altus Group’s Transaction Tax Team is closely monitoring the implementation of this new bill and its impact on the Marketplace Facilitators that solicit sales in Louisiana. 

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