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Tax Facts Vol. 11, No. 1

Tax Facts Index

TAX FACTS NEWSLETTER

EAST BATON ROUGE PARISH

Department of Finance

Vol. 11,  No. 1

January 2000

Preliminary Injunction on Sales Tax Exemption

The October 1999 issue of "Tax Facts" included an article explaining Act 1266 of the 1999 Legislative Session. Act 1266 provides an exclusion from local sales and use tax for all tangible personal property purchased for subsequent lease or rental. On October 6, 1999, District Court Judge Kay Bates issued an injunction against the sales and use tax exclusion, which means the exclusion is no longer in effect. The injunction will remain in effect until the Court rules on the constitutionality of Act 1266. As a result of this injunction, effective July 1, 1999, the City-Parish Government will collect sales and use tax on property purchased for subsequent lease or rental.

Storage of Tangible Personal Property - Subject to Sales and Use Tax

The Sales and Use Tax Ordinance levies a tax on tangible personal property purchased for use, consumption, distribution, or storage for use or consumption in this Parish. The Ordinance defines "storage" as any keeping or retention in the parish of tangible personal property. Storage of property in this Parish is subject to our sales and use tax. However, according to R.S. 33:2716.2, property purchased from out-of-parish, delivered into East Baton Rouge Parish by common carrier, and the invoice or purchase order is documented for use outside this Parish is not subject to our use tax. Therefore, property stored in this parish for use outside of this parish should be earmarked as such, otherwise it will be subject to our use tax. No use tax is due although such property may be stored in this parish for an indefinite period of time. If the property is later removed from storage and subsequently used in this parish, then it becomes subject to our use tax.

Internet and Catalog Sales - Serious Problem

Internet and catalog shopping impacts local businesses and local government tax revenues. The volume and dollar amount of out-of-state sales are growing at an alarming rate. Local merchants and vendors are at a competitive disadvantage when selling products similar to out-of-state vendors. The in-state merchants must collect state and local taxes from their customers, but the out-of-state and Internet vendors do not. Local governments are losing millions of dollars in potential sales tax revenues which are essential for the continued funding of vitally needed police, fire, public works, and other basic public services. State and national governmental organizations are urging Congress to "level the playing field" for local businesses and force Internet and catalog retailers to collect and remit sales taxes. The City-Parish will continue our efforts to address this problem through our congressional delegation and the state and national governmental organizations to which we belong. The Metropolitan Council will adopt a resolution urging members of the Louisiana Congressional Delegation to support local taxation of Internet and catalog sales.

George Pacific Receives Direct Payment Approval

The City-Parish has authorized Georgia Pacific to remit sales and use tax directly to this government. Georgia Pacific's "direct pay" status became effective August 17, 1999, and only affects their Port Hudson operations.

This "direct pay" status authorizes Georgia Pacific to remit sales and use tax to the City-Parish instead of to its vendors. This authorization applies to invoices for the purchase or lease of tangible personal property delivered, or the purchase of taxable services performed within East Baton Rouge Parish. The Direct Pay authorization does not apply to purchases picked up in another parish or services performed in another parish. These latter transactions are taxable in the parish where the sale or service occurs.

Georgia Pacific vendors were notified of the new "direct pay" status. Pursuant to that notice, vendors selling and delivering to George Pacific or any vendor providing taxable services to Georgia Pacific, should have stopped charging local tax effective August 17, 1999.

Any vendor selling to Georgia Pacific other than the Port Hudson Operations should continue to collect the appropriate local tax based on point of delivery.

Since Georgia Pacific is responsible for accruing the proper sales and use tax, vendors should use Line 8 of our Sales and Use Tax Report for reporting sales to Georgia Pacific. Line 8 is to be identified as "GEORGIA PACIFIC DIRECT PAY." These sales will be deducted from gross sales when computing the sales tax due.

Sales Tax Due Dates
Following are the sales tax due dates for the first quarter of 2000:

For the
Month of

Tax Due
Date

Delinquent
Date

January 2000
February
March

February 1
March 1
 April 1

February 22
March 21
April 21

Returns bearing a U.S. postmark on or after the above delinquent dates will be assessed penalty, interest and loss of vendor's compensation. Remember to mail your return early.

Taxpayer Topics

The Tax Facts Newsletter is issued quarterly by the Department of Finance/Revenue Division to provide information concerning developments and policies regarding the collection of local sales tax within East Baton Rouge Parish.

City of Baton Rouge - Department of Finance
P. O. Box 2590
Baton Rouge, LA  70821-2590
ATTENTION:  Steve Thomas, Assistant Revenue Manager
or send e-mail to sthomas@brgov.com

Need Assistance?

If you need assistance, help is just a phone call away.   Taxpayers may call the Revenue Division and speak with a member of our staff at the following telephone numbers between the hours of 8 a.m. and 5 p.m., Monday - Friday.

Sales/Use Tax

(225) 389-3084

Sales/Use Tax Fax

(225) 389-5369

Occupational License Tax

(225) 389-3278

Occupational License Tax Fax

(225) 389-8704

Business License and Permit Office

(225) 389-3278

Proud Member of the Louisiana Association of Tax Administrators External web link not maintained by City of Baton Rouge