Louisiana Sales Tax | the ONLY STATE TRiple Taxing EQUIPMENT
During 2017, the HERT Coalition was successful in helping to enact legislation that reformed the inventory tax system in Louisiana. HB 313, signed by Governor John Bel Edwards (D) in June 2017, restores the inventory tax credit to equipment rental tax companies operating in the state. The credit had previously been disallowed for rental companies, while still being allowed for other types of businesses.
Despite this victory, the Louisiana tax system still needs additional work. Louisiana is the only state in which the same equipment is taxed three times under the sales tax before it is ultimately sold. Businesses pay sales tax when the equipment is first purchased for the purposes of renting it out. Second, sales tax is collected on the transaction when the equipment is rented to a customer. Finally, sales tax is collected when the equipment is sold.