Louisiana – LA Sales Tax Calculator: User Guide

Louisiana is a US State with colorful cities, outstanding Southern hospitality, French-American-Spanish-African-Native American influences, Creole & Cajun cuisine, and all-time favorite Mardi Gras. It is situated in the southeastern region of the United States on the Gulf of Mexico.

Though the state has a struggling economy (ranked on 49 among 50 states), with not-so-great economic growth and a satisfactory business environment, there are still chances for your business to flourish, if done with the right strategy.

One of the foremost things you must know while starting, expanding, or relocating your business is Louisiana is LA Sales Tax. You should be aware of the basics of sales tax and their rates and calculation process. Our experts have worked days and nights to bring you a comprehensive Louisiana Sales Tax guide supported by a handy Sales Tax Calculator to give you a smooth start.

So without wasting any of your precious time, let's get started!

Louisiana Sales Tax Facts

• The statewide sales tax rate charged in Lousiana is 4.45%. Besides, several counties are also allowed to levy local sales tax, ranging between 0% and 6%. Moreover, 98 out of 502 cities in Louisiana also collect sales tax ranging from 0% to 7%. Hence, raising the combined sales tax rate up to 11.45%.
• Special sales tax may also apply in some special cases, with rates ranging between 0% to 6.75%.
• Breaux Bridge, Louisiana, is among the cities which charges the lowest possible combined sales tax rate of 7.95%.
• Lake Providence is among cities that charge the highest possible combined sales tax rate of 11.45%.
• Lousiana has a lower state-wide sales tax rate than 92.3% of the states.
• Groceries are exempted from sales tax in Lousiana.
• Lousiana has several sales tax holidays throughout the year, where items like Ammunition, Firearms, Hunting Supplies, TPP, and Hurricane Preparedness Items can be bought without paying sales tax.
• As LA Sales Tax is applied on end consumers, so individuals and businesses can claim sales tax exemption using Louisiana Sales Tax Exemption Form on qualifying purchases of goods for resale, improvement, or as raw materials.
• Purchases that are not subjected to sales tax by the online and out-of-state retailer are supposed to be subjected to Lousinana Use Tax, having rate equivalent to the sales tax rate.
• LA has a destination-based sales tax so that sales tax would be charged according to the buyer's location.

How to calculate Sales Tax in Lousiana?

Businesses and Sellers engaged in retail sale, lease, or rental of tangible personal property (TPP) and specific services and have Nexus are required to pay Sales tax to Lousiana (state and local) on the sale of specific goods and services. They are required to collect, manage, and transfers it to the Lousiana Department of Revenue (LDR) while staying in compliance with state laws and avoid penalties and interest.

The sales tax determined on four factors:

1. Nexus: It is a connection of business with a state. The business is only liable to pay taxes to the states with Nexus.
2. Out of State Seller's Eligibility: Out of State Seller is only required to register, collect, and remit the sales tax to the state's authorities if it falls under the criteria provided by the state.
3. Location and Products or Services: The sales tax rate varies from product to product and location to location. You must check the sales tax rate applicable to your product according to the product category, county, and city in Lousiana.
4. Exemptions: Almost all goods are eligible for sales tax regulation. However, groceries and maybe a few more, are exempted under Lousiana Law. So you should check with Lousiana state government as to which goods and services sold in Lousiana are subject to sales tax.

To calculate Sales Tax in Lousiana, follow the steps below:

Step 1 – Determine your Nexus:

You, as a Business owner, are only required to collect sales tax if you are eligible for collecting sales tax and have Sales Tax Nexus in the Lousiana State. And to determine your Nexus in Lousiana, you must have any of the following:

• Selling, renting, or leasing of tangible personal property (TPP) in the state.
• Delivering the products in LA in a vehicle owned or operated by the seller.
• Furnishing services in the Lousiana that are taxable under the state law.
• Holding property for resale in the state
• Maintaining a business location like office, warehouse in the LA.
• Full-time or part-time resident or nonresident employees like salesmen or agents operating in the state.
• Maintaining an inventory of TPP for lease or rental in the LA.

Step 2 – Determine the eligibility to collect sales tax as a seller:

Out of State Seller is eligible to register, collect and remit sales tax under Lousiana Law, if:

1. The out of state seller has a gross revenue exceeding $100,000 into Lousiana in the previous or current calendar year.
2. OR, Makes 200 or more sales in the previous or current calendar year in Lousiana.

Step 3 – Determine the Sales Tax Rate:

Once you have determined that your Nexus is with Lousiana, next is to deduce the Sales Tax rate (State County + City Sales Tax) applicable on your product, for which you can refer the tables below:

Lousiana Sales Tax Rates by Location:

The state-wide Sales Tax rate in Lousiana is 4.45%. Besides, many cities and counties levy additional local sales tax on tangible personal property and certain services. Following are the Sales Tax rate on State, County, and city level in Lousiana:

Step 4 – Calculate Sales Tax:

After determining the sales tax rate according to the location and type of purchases, it is easy to calculate the sales tax amount charged on the product and gross price (amount after tax) of a product.

Example # 1:

For instance, you are selling a Bedsheet on your store in Abbeville, Lousiana, having a net price tag of $40. The amount that a buyer has to pay (including sales tax) on a check out would be:

Manual Method:

Net Price (amount before Tax) of a Bedsheet: $40

Total Sales Tax rate: 0.00% (Abbeville) + 3.75% (Vermilion Parish) + 4.45% (Lousiana State) = 8.20%

Total Sales Tax amount = $40 x 8.20% = $3.3

Gross Price (Amount after Tax) = 40 + 3.3 = $43.3

It means the amount the buyer has to pay for a Bedsheet on a cash counter would be $43.3.

Using our Sales Tax Calculator:

All of the steps mentioned above can be skipped to get an instant result using our Sales Tax Calculator. All you need is:

1. Input the $40 Net Price of a Bedsheet as Amount Before Tax
2. Input or select 20% of the combined Sales Tax rate on the Tax Rate menu.

Our calculator will automatically calculate the result, and represents it in 3 different forms, as shown in the image below:

Reverse Sales Tax Calculation

In the example above, we have explained to you to calculate the Sales Tax amount payable in a product, and the Gross Price of the Product.

But there are also instances when you are required to deduce how much sales tax buyer has actually paid on a product or you may want to check the accuracy of the sales tax indicated on your item's receipt.

This is where the Reverse Sales Tax Calculation Kicks in. And luckily, our Lousiana Sales Tax Calculator can perform this calculation like a Pro.

Example:

Your buyer has paid $25 for a Pillow Cover at your store in Addis, Lousiana. Now the buyer is inquiring how much the Pillow Cover actually cost before the sales tax was added. So you need to follow the steps below to determine the amount before tax (net price) of a Pillow Cover:

Gross Price (Amount after Tax) of Pillow Cover: $25

Total Sales Tax rate: 0.00% (Addis) + 5.00% (West Baton Rouge Parish) + 4.45% (Lousiana State) = 9.45%

Manual Method:

Gross Price with sales tax = [Net Price × (tax rate in decimal form + 1)]

25 = [Net Price x ((9.45/100) + 1)]

25 = Net Price x 1.10

$22.7 = Net Price

So the original Price (net price) of the Pillow Cover was $22.7.

Using our Sales Tax Calculator:

You can also use our Sales Tax Calculator for Reverse Sales Tax calculation to skip the above mentioned manual method. All you need is:

1. Input the $25 Gross Price of Pillow Cover as Amount after Tax
2. Input or select 9.45% of the combined Sales Tax Rate on the Tax Rate

Our calculator will automatically calculate the result and represents it in 3 different forms.

FAQs