Louisiana has enacted click-through and affiliate nexus provisions, applicable to tax periods beginning on and after April 1, 2016. Louisiana’s definition of a dealer for tax collection purposes is expanded to include any person soliciting business through an independent contractor or other representative pursuant to an agreement with a Louisiana resident or business under which the resident or business, for a commission, referral fee, or other consideration, directly or indirectly, refers potential customers to the seller, whether by an internet link, an in-person oral presentation, telemarketing, or otherwise. The click-through legislation applies to sellers whose cumulative gross receipts from sales of tangible personal property to customers in Louisiana who are referred to the person through such an agreement exceed $50,000 during the preceding 12 months. This presumption may be rebutted if the person can demonstrate that he cannot reasonably be expected to have gross receipts in excess of $50,000 for the succeeding 12 months.
The legislation also expands the definition of a dealer to include any person who:
Additionally, a person will be presumed to be a dealer if it holds a substantial ownership interest, directly or through a subsidiary, in a retailer maintaining sales locations in Louisiana, or is owned, in whole or in substantial part, by a retailer maintaining sales locations in Louisiana or by a parent or subsidiary thereof. For purposes of the legislation, “substantial ownership interest” means affiliated persons with respect to each other where one of such persons has an ownership interest of more than 5%, whether direct or indirect, in the other, or where an ownership interest of more than 5%, whether direct or indirect, is held in each of such persons by another person or by a group of other persons which are affiliated persons with respect to each other.
The click-through and affiliate nexus provisions for establishing a person as a dealer for sales and use tax purposes shall not be used in determining whether the person is liable for payment of Louisiana income and franchise taxes. If the U.S. Congress enacts legislation authorizing states to require a remote seller to collect sales and use taxes on taxable transactions, the federal law shall preempt the provisions of the Louisiana law. (Act 22 (H.B. 30), Laws 2016, First Extraordinary Session)