In March, Real Estate Weekly ran a story on State Sen. Eric LaFleur, D-Ville Platte, who was then planning to introduce a bill in the upcoming legislative session to eliminate a fee or tax on the sale or transfer of real estate. “A real estate transfer tax is effectively taxing Louisiana homeowners or property owners twice. Louisiana property owners already pay annual taxes on the value of their property, both personal and business,” LaFleur said. “I think that it is fundamentally unfair to hit property owners again at the time that they choose to sell their property or transfer it to a loved one.”
The Louisiana Realtors Association has gotten behind LaFleur on his House Bill 135 and has planned an “in-person” call to action today at 2 p.m. at the State Capitol. The group has also developed a fact sheet and website to inform the public of the issues surrounding this legislation.
Louisiana is currently one of thirteen states that do not use real estate transfer taxes to fund government. Three of those states, Montana, Missouri and Arizona, have recently passed constitutional prohibitions similar to HB 135 in a preemptive move to keep cash-strapped municipalities from ever using this taxation to fund programs.
The real estate transfer tax could be a way to plug gaps in state and local budgets without reducing services or raising another tax. But the tax could harm an already depressed real estate market and put home ownership beyond the reach of some potential purchasers.
As always, my suggestion is to gather information on the issues, form an educated opinion, and promote that opinion as best you can. A good place to start could be today’s rally at the Capitol.
(Brian Andrews is a certified mortgage banker specializing in the financing of commercial real estate. His business is Andrews Commercial Real Estate Services and he can be reached at email@example.com.)