Louisiana House Bill HB441

Louisiana 2011 Regular Session

• Introduced: 4/25/11
• Refer: 4/25/11
• Report Pass: 6/2/11
• Engrossed: 6/15/11

Caption

Extends the research and development tax credit program from Dec. 31, 2013, to Dec. 31, 2019, and changes the refundable tax credit to a tax rebate (RE INCREASE GF RV See Note)

Impact

The bill's amendments significantly impact state tax laws concerning the administration of tax credits. By allowing any entity to benefit from the tax credit program and requiring the Department of Economic Development to report annually on the issuance of these credits, the bill introduces greater transparency and oversight into the process. Furthermore, the requirement that entities receiving research and development tax credits cannot simultaneously receive other incentives administered by the Department aims to streamline tax benefit management and prevent overlapping claims that could strain state resources.

Summary

House Bill 441 extends the research and development tax credit program in Louisiana, changing the program's expiration date from December 31, 2013, to December 31, 2019. This legislation aims to provide a financial incentive for employers in Louisiana to engage in research and development activities, thereby fostering innovation and economic growth within the state. It also modifies the criteria for qualifying for the tax credit, allowing any taxpayer who incurs qualified research expenses, not just those who employ Louisiana residents, to apply for this credit. This change broadens the scope of eligible entities, potentially increasing participation in the program.

Sentiment

The sentiment surrounding HB 441 appears generally favorable among supporters who argue that extending the tax credit program will encourage continued investment in research and development, which is critical for innovation and the state's economic health. However, there are concerns from some quarters regarding the potential impact on local businesses that might not have access to similar benefits or that could face increased competition from entities not solely based in Louisiana. The modifications to tax credit eligibility may elicit mixed reactions among various stakeholders, including small business owners and larger corporations.

Contention

Notable points of contention around the bill concern the limitations placed on receiving other tax incentives while benefiting from the research and development credits. Critics of this provision suggest that it might disproportionately disadvantage smaller businesses or startups that rely on multiple forms of financial support to thrive. Additionally, the focus on tax credits may spark debates about whether such incentives are the best way to promote economic development or if other methods, such as direct funding for research programs, would prove more beneficial.