Shoppers across Louisiana should have seen a slight drop in sales taxes beginning this week, but Terrebonne and Lafourche parishes still have some of the highest local rates in the state.
The Legislature voted during a special budget session that ended June 24 to reduce the state sales tax from 5 percent to 4.45 percent.
That brings the total state and local sales tax to 9.95 percent across Terrebonne.
In Lafourche, the combined sales taxes range from 9.1 percent to 9.85 percent, depending on the city of taxing district.
Local sales tax rates are capped at 5 percent. However, they can exceed that limit with legislative approval.
For example, Lafourche Parish government has put a measure on the November ballot to increase the sales tax for garbage collection from 0.7 percent to 1 percent. The parish needed legislative approval to do so because raising the rate will push the local rate in many areas of the parish above the 5 percent cap.
Businesses within the city limits of Thibodaux are not included in the tax because the city operates a separate system for solid waste collection.
Lafourche has about six groupings of different sales tax districts: Thibodaux, Lockport and Golden Meadow, Road District A north of the Gulf Intracoastal Waterway and Road District 2 south of the waterway.
The highest rates are found in Golden Meadow and Road District 2, which includes Cut Off, Galliano and Port Fourchon, each at a combined 9.85 percent.
In Terrebonne, government is consolidated, covering the entire parish. There are no separate city or town governments as in Lafourche.
“The sales tax in Terrebonne Parish is a ‘parishwide’ rate, meaning that wherever you are in the parish, you will pay 5.5 percent (local) sales tax on taxable goods and services,” said parish Sales Tax Director Mark Daigle.
In both parishes, sales tax revenue goes to schools, law enforcement and local levee districts. Lafourche also collects sales tax for solid waste and roads. Terrebonne collects a general 1.92 percent for the parish.
Lafourche sales tax collections have dropped in recent years, raising $73.9 million in 2016 and $72.4 million last year.
Terrebonne collections were higher, bringing in about $115.8 million in 2016 and $116.4 million in 2017.
Compared to nearby parishes, Daigle said, Terrebonne is on the higher end.
In St. Mary Parish, local sales tax rates range from 4 percent to 4.3 percent. Assumption and St. Charles parishes are 5 percent. St. Tammany Parish’s rates range from 4.25 percent to 5.25 percent.
However, when shoppers from St. Mary Parish, for example, come to Houma to shop, that drives up local revenue, said Daigle.
Terrebonne’s hotel-motel tax of 5 percent is also largely paid by out-of-towners, he added.
Motor vehicle sales taxes are calculated at a slightly different rate. The state has a 4 percent sales tax rate for vehicle purchases, but local rates remain the same. The local rate is calculated bases on where the person buying the vehicle lives, not where the dealership is located.
According to the national Tax Foundation, Louisiana’s average combined local and state sales tax rate was 10.02 percent in 2018. As a result, it was ranked as the highest sales tax state in the country.
Average state and local collections per capita in 2015, the most recent data available, was $1,521, ranking eighth nationally.
However, Louisiana property and income taxes are lower than other states.
A report from 24/7 Wall Street in April ranked Louisiana the sixth lowest taxes state in the country.
According to the report, which gathered data from the Tax Foundation’s Facts and Figures 2018 report, state residents spend about 7.6 percent of their income on state and local taxes.
The state’s 20-cent-per-gallon gasoline tax is also far less than many other states, the report says.
Property tax collections per capita are eighth lowest in the country at $869.
-- Staff Writer Julia Arenstam can be reached at 448-7637 or Julia.firstname.lastname@example.org Follow her on Twitter at @gingerale214.
Posted on Fri, July 6, 2018
by By Julia Arenstam Daily Comet Staff Writer