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Effective July 1, 2008, A Louisiana state and local sales and use tax exclusion has been enacted for the lease or rental of pallets used in packaging products produced by a manufacturer. In addition, the term “manufacturer”, for the purposes of the exclusion, has been defined as a person whose primary activity is manufacturing and who is assigned by the Louisiana Department of Labor a North American Industrial Classification System (NAICS) code within manufacturing sectors 31-33 as they existed in 2002. (Act 419, H.B. 916, Laws 2007)


A revision of the definition of ‘tangible personal property’ now specifically excludes newspaper from such definition. Therefore, newspapers are not subject to the collection of sales and use tax. (Act 480 H.B. 386, Laws 2007, effective for all taxable periods beginning on or after July 1, 2008, except as noted; Resume Digest for H.B. 386, Louisiana Legislature, July 2007)


The U.S. District Court found that an internet retailer with no physical presence in Louisiana did not have sufficient nexus with St. Tammany Parish to justify the collection of local sales and use taxes. Despite an affiliation with its parent company and a bricks-and-mortar retailer, the courts did not feel nexus had been established since the entities did not share management, employees or offices, and were financially independent of each other. (St. Tammany Parish Tax Collector v., U.S. District Court, Eastern District of Louisiana, No. 05-5695, March 22, 2007)


Louisiana announced a reduction in the sales and use tax rate for purchases of natural gas and electricity for non-residential consumers. Effective January 1, 2006 and continuing through June 30, 2009, the rate is reduced from 3.8% to 3.3%. Other changes impact sales of natural gas and electricity to paper and wood products manufacturing facilities, including a full tax exemption for sales of electric power or energy to paper and wood products manufacturing facilities between July 1, 2006 and December 31, 2008. (Louisiana Department of Revenue, Revenue Information Bulletin No. 05-035, December 13, 2005)


Louisiana amended its Civil Code to define component parts of an immovable and those items permanently attached to immovables. This clarification is critical as the state sales tax law does not treat repairs to immovable property as taxable services. Anything permanently attached to an immovable is considered to be a component part of that immovable. Further, the amendment names plumbing, heating, cooling, electrical or other installations, specifically, as component parts of immovables. To be treated as a permanent attachment, an item cannot be removed from the immovable without causing significant damage to itself or to the immovable. Otherwise, a permanent attachment is one which is considered by societal norms to be a component part of an immovable. (Act 301 (S.B. 196) Laws 2005)



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