Streaming fans in Louisiana soon could be paying more to watch their favorite shows and movies. This time, though, they can’t blame the services providing the programming.
Their ire over more costly entertainment is due to Pelican State lawmakers who now are meeting in a special session to focus on Gov. Jeff Landry has proposed a reworking of Louisiana’s tax structure.
More subject to sales tax: Part of the tax overhaul is an expansion of s part of targets subject to Louisiana’s 4.45 percent state sales tax.
It would be levied on several digital products and services, including online news subscriptions, video games, and smartphone apps. Online business tools, such as Zoom, also would face the new tax.
However, , internet services and any professional services that are delivered in electronic form, such as telehealth and banking, are not part of the bill, since they already are taxed separately under state law.
Netflix Tax popular with lawmakers: Louisiana currently treats downloads of digital books, movies, and music as tangible products subject to the sales tax.
House Bill 8, sponsored by Democratic state Rep. Ken Brass of Vacherie, is seen by its supports as the next logical progression.
Louisiana House Ways and Means member Rep. Rashid Young agreed with Brass’ perspective, calling the taxing of digital services, which already is the law in 44 states, a response to changes in the marketplace.
“Blockbuster used to exist in a physical form. You would go and rent a DVD … But because of a market boom, we now do that in a digital form,” said Young, a Democrat from Homer.
Another state representative added one more argument for the new levy, which was dubbed the Netflix Tax on social media.
“Streaming services, they’re really luxury items. People may choose not to get cable, those are things we’re not bothered paying taxes on,” said New Orleans Democratic Rep. Mandie Landry.
The trio’s arguments were enough to this week convince enough of their House colleagues to clear the Netflix Tax and send it to the Senate for consideration.
More taxed services: In addition to the new streaming tax revenue, Louisiana House members have advanced House Bill 9, which would make another 41 services subject to the state’s sales tax.
The types of services that would face the tax are, shall we say, interesting, ranging from lawn care to pet grooming to dating and social matching services and marriage bureaus.
The new sales tax revenue is projected to generate an estimated $400 million in revenue. The money is needed to counter plans to lower the state’s individual income tax to a flat 3 percent and eliminate its corporate franchise tax. Those proposals also were approved this week by the Louisiana House.
The special legislative session focusing on tax reform started Nov. 6 and must conclude by Nov. 25.
You also might find these items of interest:
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