Louisiana: Sales Tax Handbook
What constitutes sales tax nexus in Louisiana?
One of the more complicated aspects of Louisiana sales tax law is sales tax nexus, the determination of whether a particular sale took place within the taxation jurisdiction of Louisiana, and is thus subject to state (and possibly local) sales taxes.
If a vendor's transactions are determined to have nexus in Louisiana, the vendor must register for a Louisiana sales tax license and collect appropriate sales taxes from the buyer for all transactions with nexus in the state. On this page, we have compiled some of the most commonly needed facts about what constitutes sales tax nexus in Louisiana.
Sales Tax Nexus in Louisiana
According to Louisiana's law, "dealers" who have tax nexus can be defined as "engaging in business". This term is defined by a business having, maintaining, occupying, or using a physical facility within the boundaries of this state through any representative or employee, permanently or temporarily.
Out of state dealers are determined to have sales nexus by whether or not the are doing business within the state's boundaries. Business can be described as any activity engaged in by any individual with the objective of "gain, benefit, or advantage, direct or indirect". This does not include any occasional, isolated sales by an individual who "does not hold himself out as engaged in business".
For additional details on sales tax nexus law in Louisiana, see the nexus information page from the Department of Revenue at http://www.salestaxsupport.com/sales-tax-information/states-sales-tax-by-state/LA-Louisiana/tax-nexus
Taxation of Internet-Based Sales in Louisiana
NOTE: 2018 Supreme Court Ruling Regarding Online Sales Taxes
In the 2018 Supreme Court case South Dakota vs. Wayfair Inc, Et Al., the court overturned a previous ruling that required a merchant to have physical nexus in order for a state to collect sales tax. This means that any state is now free to enforce collection of sales taxes on out-of-state online merchants. The information provided here may be subject to change, and many states are expected to begin collecting online sales taxes following this ruling.
Generally, Louisiana does not charge sales tax on Internet-based transactions determined to have nexus within the state. This means that purchases from Amazon.com and other Internet-based retailers may be sales-tax-free.
The nexus status and taxability of Internet-based sales, by vendors and/or consumers within Louisiana, have been the subject of hot debate in recent years. You can learn more on our introduction to Internet-based sales taxes.
Does my business have tax nexus in Louisiana?
The folks at the sales tax compliance company Avalara are an approved Louisiana sales tax partner, and you can use their free Louisiana nexus wizard tool to determine whether or not your business has nexus, and is therefore required to pay Louisiana sales taxes. If you're interested in automating your sales tax collection and filing process, click here to get more information.
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