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Effective April 1, 2004 the interstate telecommunications sales tax rate in Louisiana will change from its current rate of 3% down to 2%. However, the intrastate telecommunications tax rate will remain unchanged at 3%. In Louisiana, a telecommunication service is considered to be an interstate activity service if the service originates and/or terminates within the state and all charges are billed to a Louisiana service address. (Revenue Information Bulletin No. 04-005, Louisiana Department of Revenue, January 21, 2004)

(02/15/2004)

A company in Louisiana received gas to be used in compression at no cost, as was expressed by contract. The customer was not required to pay sales or use tax, regardless of the transfer of possession, because relevant sales tax statutes base the amount of sales tax owed upon the sales price, of which there was none. Similarly, use tax is based upon either the article's actual cost or its reasonable market value, whichever is lower. A good received at no cost is therefore not subject to sales or use tax. Because there was no sales cost under the Louisiana gas contract, no sales or use tax was due. (Louisiana Court of Appeal, Third Circuit, No. 02-0925, February 5, 2003)

(06/15/2003)

Under the Louisiana Civil Code, already-installed medical imaging equipment was ruled to be immovable property because the removal of the equipment would result in damage either to the equipment or to the structure to which it was attached. Once installed, the equipment was connected to the structure's electrical system and was therefore an electrical installation. This satisfies the first paragraph of Article 466 by declaring the equipment as a component of the building. Without this connection, the equipment would still be in compliance with the second paragraph of Article 466 due to its likely damage if removed from the building. (Louisiana Department of Revenue, No. 03-005, March 17, 2003)

(06/15/2003)

The Louisiana Department of Revenue in the state has stated that charges for a DSL subscription for high-speed Internet access are exempt from sales and use tax. (Louisiana DOR Private Letter Ruling No. 03-004, 04/04/03)

(05/15/2003)

Louisiana sales and use tax laws are not applicable to revenue sharing agreements between leasing companies and an owner of tangible personal property for leasing purposes. This is due to the fact that the arrangement isn't within the scope of the definition of "lease or rental" of tangible personal property. The property owner supplied items to be leased by the leasing company in exchange for a usage fee. The usage fees were not considered lease or rental payments because the property owner still held control of the property and supplied the items at its own discretion. The usage fee was paid only if the property was rented. Under the Louisiana Civil Code, a company must have "enjoyment of the property during a certain time" to be considered a lease or rental from the property owner. (Private Letter Ruling No. 03-002, Louisiana Department of Revenue, February 25, 2003)

(04/15/2003)

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