LAFAYETTE — The City-Parish Council on Tuesday voted unanimously to postpone a vote on whether to end a tax rebate that helps area businesses cover accounting expenses related to collecting and paying sales tax to city-parish government.
Local law allows businesses to keep 2 percent of total collections for city-parish government sales taxes as long as the sales tax payment is on time.
City-Parish Councilman Jay Castille had proposed an ordinance to end the rebate, a move that would bring an estimated $1.5 million a year of additional revenue into city-parish coffers.
Councilman Kenneth Boudreaux, who asked that the vote be postponed, said he believes more time is needed for public input and to reach out to the business community before the council votes on the rebate.
He said the council and public “just need some overall explanation of this issue.”
The Greater Lafayette Chamber of Commerce had requested that the issue be deferred, but the chamber has yet to take a formal stance on the issue. No date has been set for when the council might revisit the issue.
Castille said last month that ending the rebate could bring in badly needed revenue to fill gaps in the city-parish budget.
City-Parish Traffic and Transportation Director Tony Tramel wrote in a memo to council members about the proposal that the 2 percent rebate appears to have been implemented years ago “to appease the retail community.”
Tramel also wrote the rebate might be considered an impermissible donation of public money to private businesses.
Louisiana law general prohibits local government from giving money, services or other things of value to private individuals or businesses.
The Lafayette Parish School Board ended a similar sales tax rebate program in 1994, followed by Youngsville in 1999 and Carencro and Scott in 2011.