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‍Amendment ‍3Board ‍of ‍Tax ‍Appeals ‍Jurisdiction

‍A ‍vote ‍for ‍would

‍Allow ‍the ‍Board ‍of ‍Tax ‍Appeals ‍to ‍rule ‍on ‍constitutional ‍questions.

‍A ‍vote ‍against ‍would ‍

‍Continue ‍to ‍assign ‍constitutional ‍questions ‍in ‍tax ‍disputes ‍only ‍to ‍the ‍courts.

‍Current ‍Situation ‍

‍Individuals ‍and ‍businesses ‍unhappy ‍with ‍a ‍decision ‍they ‍believe ‍is ‍in ‍error ‍by ‍the ‍state ‍Department ‍of ‍Revenue ‍or ‍local ‍taxing ‍authorities ‍can ‍appeal ‍to ‍the ‍state ‍Board ‍of ‍Tax ‍Appeals. ‍This ‍Board ‍is ‍Louisiana’s ‍version ‍of ‍a ‍Tax ‍Court. ‍The ‍Board ‍is ‍a ‍three-person ‍quasi-judicial ‍executive ‍branch ‍body ‍whose ‍members ‍must ‍be ‍attorneys ‍with ‍tax ‍law ‍experience ‍and ‍credentials. ‍All ‍are ‍appointed ‍by ‍the ‍governor ‍and ‍confirmed ‍by ‍the ‍Senate. ‍The ‍Board ‍hears ‍cases ‍on ‍various ‍tax ‍and ‍fee ‍disputes ‍but ‍does ‍not ‍address ‍property ‍tax ‍issues, ‍which ‍are ‍the ‍domain ‍of ‍the ‍Louisiana ‍Tax ‍Commission. ‍Board ‍decisions ‍can ‍be ‍appealed ‍to ‍state ‍courts ‍of ‍appeal. ‍One ‍of ‍the ‍members ‍hears ‍cases ‍for ‍the ‍Board’s ‍Local ‍Tax ‍Division, ‍which ‍considers ‍disputes ‍with ‍local ‍tax ‍collectors. ‍Thirty-four ‍states ‍have ‍tax ‍tribunals, ‍including ‍28 ‍that ‍are ‍within ‍the ‍executive ‍branch.

‍The ‍Board ‍does ‍not ‍have ‍the ‍authority ‍to ‍declare ‍tax ‍laws, ‍ordinances ‍or ‍tax ‍collector ‍actions ‍as ‍unconstitutional. ‍Taxpayers ‍must ‍have ‍their ‍Board ‍case ‍transferred ‍to ‍a ‍district ‍court ‍if ‍they ‍believe ‍a ‍tax ‍law, ‍rule ‍or ‍action ‍of ‍a ‍taxing ‍authority ‍is ‍unconstitutional. ‍Even ‍if ‍just ‍a ‍portion ‍of ‍a ‍case ‍involves ‍a ‍claim ‍of ‍unconstitutionality, ‍the ‍whole ‍process ‍is ‍put ‍on ‍hold ‍until ‍the ‍court ‍system ‍can ‍resolve ‍the ‍constitutional ‍issue. ‍This ‍system ‍results ‍in ‍court ‍cases ‍that ‍can ‍take ‍a ‍year ‍or ‍longer ‍to ‍resolve.

‍Proposed ‍Change ‍

‍The ‍proposed ‍amendment ‍would ‍enhance ‍the ‍scope ‍and ‍power ‍of ‍the ‍Board ‍of ‍Tax ‍Appeals ‍and ‍allow ‍the ‍body ‍to ‍rule ‍on ‍whether ‍taxation ‍and ‍fee ‍matters ‍are ‍constitutional ‍under ‍Louisiana ‍or ‍U.S. ‍law. ‍This ‍level ‍of ‍authority ‍is ‍not ‍generally ‍allowed ‍for ‍executive ‍branch ‍agencies. ‍However, ‍the ‍American ‍Bar ‍Association ‍recommends ‍that ‍executive ‍branch ‍tax ‍tribunals ‍should ‍possess ‍at ‍least ‍some ‍limited ‍authority ‍to ‍consider ‍constitutional ‍issues ‍on ‍specific ‍grievances ‍that ‍come ‍before ‍those ‍bodies. ‍Many ‍state ‍tribunals ‍may ‍do ‍so. ‍This ‍amendment ‍would ‍let ‍taxpayers ‍have ‍their ‍entire ‍tax ‍dispute ‍heard ‍in ‍one ‍forum ‍and ‍could ‍expedite ‍resolution. ‍The ‍Board ‍decisions ‍could ‍be ‍appealed ‍to ‍state ‍courts. ‍Taxpayers ‍still ‍would ‍have ‍the ‍option ‍to ‍take ‍their ‍case ‍to ‍the ‍courts ‍instead ‍of ‍the ‍Board ‍of ‍Appeals. ‍The ‍Legislature ‍would ‍be ‍able ‍to ‍pass ‍laws ‍affecting ‍the ‍Board’s ‍jurisdiction ‍and ‍other ‍related ‍matters ‍with ‍a ‍2/3 ‍vote.

‍Argument ‍For

‍Taxpayers ‍should ‍be ‍able ‍to ‍seek ‍timely ‍redress ‍for ‍unconstitutional ‍taxes. ‍The ‍Board ‍of ‍Tax ‍Appeals ‍specializes ‍in ‍tax ‍law. ‍Allowing ‍the ‍Board ‍to ‍hear ‍cases ‍involving ‍the ‍constitutionality ‍of ‍tax ‍and ‍fee ‍collections ‍only ‍makes ‍sense. ‍Tax ‍law ‍is ‍complex ‍and ‍experts ‍should ‍review ‍the ‍case ‍first. ‍If ‍either ‍side ‍does ‍not ‍like ‍the ‍decision, ‍they ‍can ‍still ‍appeal ‍to ‍the ‍court ‍system. ‍Following ‍a ‍modernization ‍of ‍the ‍Louisiana ‍tax ‍appeals ‍process ‍in ‍2014, ‍this ‍change ‍would ‍be ‍another ‍important ‍step ‍toward ‍improving ‍the ‍system ‍to ‍make ‍it ‍fairer ‍and ‍more ‍efficient. ‍It ‍places ‍Louisiana ‍in ‍the ‍mainstream ‍of ‍states ‍that ‍have ‍reformed ‍their ‍tax ‍dispute ‍process. ‍The ‍amendment ‍would ‍reduce ‍delays ‍and ‍costs ‍in ‍deciding ‍tax ‍disputes ‍which ‍is ‍why ‍both ‍business ‍and ‍local ‍government ‍support ‍this ‍change.

‍Argument ‍Against

‍Historically, ‍courts ‍have ‍been ‍the ‍only ‍bodies ‍that ‍can ‍decide ‍whether ‍an ‍action ‍or ‍rule ‍complies ‍with ‍the ‍Louisiana ‍or ‍U.S. ‍Constitution. ‍This ‍amendment ‍and ‍its ‍companion ‍act ‍would ‍change ‍that ‍precedent. ‍Unlike ‍judges ‍in ‍the ‍court ‍system, ‍none ‍of ‍the ‍members ‍of ‍the ‍Board ‍of ‍Tax ‍Appeals ‍is ‍elected ‍and ‍they ‍might ‍have ‍less ‍expertise ‍in ‍Louisiana ‍or ‍U.S. ‍constitutional ‍law. ‍Board ‍members ‍might ‍be ‍influenced ‍by ‍the ‍governors ‍who ‍appoint ‍them ‍or ‍the ‍Senators ‍who ‍confirm ‍them. ‍There ‍is ‍no ‍evidence ‍that ‍the ‍current ‍system ‍fails ‍to ‍resolve ‍issues ‍correctly. ‍Constitutional ‍decisions ‍by ‍the ‍Board ‍would ‍be ‍highly ‍likely ‍to ‍be ‍appealed ‍to ‍the ‍courts. ‍

‍Legal ‍Citation: ‍Act ‍446 ‍(House ‍Bill ‍428 ‍by ‍Rep. ‍Dwight) ‍of ‍the ‍2019 ‍Regular ‍Session ‍adding ‍Article ‍V, ‍Section ‍35. ‍Companion ‍legislation ‍Act ‍365 ‍amends ‍R.S. ‍47:337.45(A)(3), ‍337.63(C), ‍337.97, ‍1407(3), ‍1418(4)(b), ‍1435(A), ‍(C), ‍and ‍(D), ‍1561(A)(3), ‍and ‍1576(D), ‍enacts ‍R.S. ‍47:1407(6) ‍and ‍1431(D), ‍and ‍repeals ‍R.S. ‍47:1432(B).

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For more information, media interviews or public presentation requests regarding this constitutional amendment guide, please contact PAR President Robert Travis Scott at RobertScott@parlouisiana.org.