by Dr. Randall Dupont | LSUA College of Business
The Louisiana State University of Alexandria College of Business releases its November 2022 issue of the Central Louisiana Economic Dashboard.
“Online sales tax revenue surged in October due to an increase in the number of remote sellers,” says Randall Dupont, Dean of the LSUA College of Business. Online sales tax revenue for Rapides increased 168% in October to $1,314,574 from $489,992 a month earlier, the highest for the parish since the new remote sellers’ collection system was established. Among the 11 CENLA parishes, online tax revenues totaled $3.5 million compared to $1.6 million a month earlier. Year-to-date, revenues are up 30% in CENLA, and 36% in Rapides and Natchitoches parishes.
“The tax revenue increase is largely due to the increased number of retailers participating in the remote sales tax collection system,” says Dupont. The remote seller collection system more accurately matches sales tax revenue with the parish as sales taxes are charged at the location of the sale. This differs from the old voluntary direct marketer’s system in which the local portion of sales taxes was distributed based on population. The remote seller system collects the actual tax where the sale is made, and the state redistributes it accordingly.
According to the Louisiana Remote Sellers Commission, the agency processed 2,500 returns in the first quarter of FY 2021, when it started in July 2020. 8,800 returns were processed in the same period last year, and 17,000 in the first quarter FY 2023. Dupont says the Commission does not see any impact on brick-and-mortar stores as much of the increase is the result of retailers switching from the direct marketer’s system. Nevertheless, he says the remote seller system will provide a more equitable distribution of tax revenue to central Louisiana parishes.
The Central Louisiana Economic Dashboard is a service of the LSUA College of Business to help business and community leaders monitor the economic pulse of central Louisiana. To view the November 2022 CENLA Economic Dashboard, click here.
Image credit – LSUA Division of Strategic Communications