Louisiana: Regulation Outlining Local Sales Tax VDA Program Adopted

In 2017, legislation establishing the Louisiana Uniform Local Sales Tax Board (Board) was signed into law. The Board’s purpose was to provide uniformity and efficiency with respect to the imposition and administration of local sales and use tax. One of the requirements of the enabling legislation was for the Board to establish a uniform voluntary disclosure program for taxpayers seeking relief from penalties in cases where sales and use taxes were owed to more than one local sales and use tax collector. Recently, the Board adopted a new regulation outlining the details and requirements of the voluntary disclosure agreement (VDA) program. Per the regulation, the Board will accept voluntary disclosure applications from taxpayers. If the Board determines that the taxpayer qualifies for a VDA, it will issue a recommendation in accord with this conclusion to the local tax collector. Absent fraud or material misrepresentations by the taxpayer, the recommendation will be binding on the local tax collector. Taxpayers eligible for the VDA program include those with undisclosed local sales and use tax liabilities that resulted from mathematical errors, errors in interpreting the law, or mistakes in the process of reporting tax due on the return. A taxpayer will not be eligible for the VDA program if it is a registered dealer that failed to file returns as required by law, or that filed fraudulent returns. Taxpayers that have been contacted by a locality with regards to a potential tax liability or audit, or whose affiliates have been contacted, are not eligible to participate.

In general, the lookback period will include the current calendar year prior to the application date, plus the three immediately preceding calendar years. If taxes have been collected and not remitted, the look-back period includes all filing periods in which tax was collected and not remitted. Upon issuance of a binding recommendation by the Board, the local tax collector and taxpayer applicant are required to sign the agreement within 30 days. After the agreement is signed by both parties, the taxpayer must generally pay all the tax due within 60 days. With respect to interest and penalties, the local tax collector will compute interest and penalties due and send such information to the taxpayer. The interest must be paid within 30 days. After the interest is paid, the local tax collector will waive the penalties owed. Please contact Randy Serpas at 504-569-8810 with questions.