Louisiana lawmakers have turned back an effort to get tougher on business owners who avoid taxes by misclassifying their employees as independent contractors, The Center Square reports.

House Bill 34 would have allowed state regulators to penalize companies up to $1,000 per worker on a first offense, $3,000 on a second offense and $5,000 on a third offense. Officials would retain the ability to go easy on business owners who they believe made an honest mistake, according to The Center Square.

Meanwhile, a Louisiana senator has proposed a bill that would require an annual report to be filed with the Louisiana Department of Revenue by businesses filing IRS returns relating to payments made to an independent contractor for services provided in the state.

The purpose of the state bill is to encourage the secretary of the Louisiana Department of Revenue and the secretary of the Louisiana Workforce Commission to work collaboratively to detect, investigate and extinguish cases of misclassification of employees in the state based on the reports.