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Rep. Paula Davis, R-Baton Rouge, left, makes a point while answering a question from Rep. Barry Ivey, R-Baton Rouge, right, while presenting her HB10 concerning state sales tax rates during a meeting of the House Ways and Means Committee Wednesday June 20, 2018, in Baton Rouge, La. The measure passed on to the House floor by a vote of 12-5.

First, the good news for consumers in Louisiana: Since July 1, you’ve been paying slightly lower sales taxes than you had been for the past two-plus years.

Businesses also have reason to cheer: The state's sales tax system is not as convoluted as before.

Now the bad news: Even with those changes, Louisiana still has the highest combined local and state tax rate in the country.

The state also has “the worst sales tax structure in the country,” according to Scott Drenkard, director of state projects for the Tax Foundation, which is based in Washington, D.C.

Even so, the state is at least moving in the right direction, Drenkard said.

To begin with, consumers in Louisiana are now paying 4.45 percent in state sales taxes on purchases, down from the 5 percent rate they had paid during the previous 27 months.

The drop came courtesy of state legislators, who last month finally resolved a long-running budget and tax dispute that prompted three special legislative sessions this year.

Anatomy of a legislative deal: How Louisiana lawmakers arrived at final 'compromise'

At issue was how much of a temporary 1-cent increase in the state sales tax lawmakers should renew.

Conservative Republicans in the state House wanted the entire increase to expire June 30, which would have given Louisiana a 4 percent state sales tax. More moderate Republicans favored renewing 40 percent of the expiring penny, which would have fixed the sales tax rate at 4.4 percent of a dollar.

Gov. John Bel Edwards, most of the state Senate and Democrats in the Louisiana House wanted to keep half of the expiring penny, putting the rate at 4.5 cents on the dollar, to ensure that popular government programs would be fully funded after July 1. Lawmakers eventually compromised, giving Louisiana the 4.45 percent sales tax rate that took effect July 1.

The new rate means a household that earns $100,000 can expect to pay about $140 less per year in sales taxes, while a household earning half that much would pay about $70 less and a household with an income of $25,000 should pay about $20 less, according to calculations by Jim Richardson, an LSU economics professor.

The Legislature’s action had no effect on sales taxes added by local governments throughout Louisiana, which average about 5 percent.

Before July 1, when the state sales tax of 5 percent was still in effect, this meant Louisiana had a combined state and local sales tax of 10.02 percent, according to the Tax Foundation — the highest rate in the country.

Louisiana sales tax system now ranks worse than last place

At 4.45 percent, Louisiana now has a combined sales tax rate of 9.47 percent — still a tick higher than Tennessee, which has a 9.46 percent rate. Arkansas follows closely behind with 9.41 percent.

The Tax Foundation dings Louisiana not only for its nation-leading sales tax rate but also for the complexity of its taxes.

One complication is that Louisiana offers sales tax breaks for certain transactions, and local governments may or may not also give that same tax break. And, with the Legislature's approval, local governments offer some sales tax breaks on transactions that are not exempt from the state sales tax.

Adding to the red tape: Businesses have to remit state sales tax collections to the state and local sales tax collections to local governments. In almost every other state that collects sales taxes, businesses send all of their sales tax payments to the state. Only two other states have a system like Louisiana’s.

“In other states, you pay just to the state, and the state funnels it down” to local governments, said Greg Albrecht, the Legislature’s chief economist.

'A class of its own': How La. plans to revamp nation's highest, most convoluted sales tax system

One outgrowth of that system is that businesses in Louisiana can face audits from multiple tax collectors, while most states have a single audit agency.

State Rep. Julie Stokes, R-Kenner, has taken the lead in the unglamorous task of trying to simplify Louisiana’s tax collection system by making sure state and local governments offer the same tax breaks. She has had limited success, in part because entrenched business and local government interests often have a stake in keeping the complicated system.

Stokes led the Louisiana Sales Tax Streamlining and Modernization Commission, which in 2017 pushed for several measures favored by tax experts to simplify the tax code. The powerful Louisiana Sheriffs’ Association, however, and other local government entities fought a push to make them surrender their role of collecting taxes on the local level. Industries that get sales tax breaks from state governments lobbied to keep their exemptions.

So when Drenkard criticizes Louisiana, he zeroes in on the lack of uniformity in what is and isn’t taxed, and the lack of a single tax collector and audit agency.

Not all of the task force’s work has been in vain. State legislators have simplified the sales tax system a bit.

Under the 5 percent state sales tax rate that lasted for 27 months, many transactions were taxed at different rates. For example, the state taxed Bibles at the full 5 percent, electricity for nonresidential use at 4 percent, new boats at 3 percent, new-car rebates at 2 percent and the sale of equipment used for manufacturing at 1 percent.

As of July 1, almost all transactions subject to the state sales tax pay the 4.45 percent rate. The only exception is fuel and electricity used by businesses, which is taxed at only 2 percent, thanks to an aggressive lobbying campaign by business groups.

Other than that one anomaly, “you don’t have the different rates anymore,” said Kimberly Robinson, secretary of the Revenue Department.

This means less complexity for businesses, said Jason DeCuir, a business lobbyist who was the deputy secretary of revenue under Gov. Bobby Jindal. “Making the base uniform at 4.45 percent is putting us on the right track,” DeCuir said.

Like other states, Louisiana is moving to take advantage of a recent U.S. Supreme Court decision that allows states to tax internet sales even if the seller doesn’t have a physical location in the state.

Robinson heads the Louisiana Sales and Use Tax Commission for Remote Sellers, which had its first meeting last week. Its charge is to establish rules requiring internet companies to collect taxes on purchases made in the state and to remit the money to tax authorities.

The Supreme Court ruling seemed to indicate that states should have a single tax collector for the remote sales. If Louisiana adopted that change, the state would operate with a two-track system by continuing to have multiple tax collectors for transactions within Louisiana.

Robinson said the commission is planning to have the new registration and software tax system in place for remote sellers by Jan. 1.

Robinson is already doing her part to ensure retailers are taxing consumers at the new 4.45 percent.

On the first day the new sales tax rate was in effect, she checked her lunch tab at Zea Rotisserie & Bar in Baton Rouge and her receipt for a purchase at Talbots.

“They were charging the right amount,” Robinson said.

Follow Tyler Bridges on Twitter, @tegbridges.