Louisiana Senate Bill SB135

Louisiana 2011 Regular Session

• Introduced: 4/25/11
• Refer: 4/25/11
• Report Pass: 5/16/11
• Engrossed: 5/19/11
• Refer: 6/2/11
• Report Pass: 6/13/11
• Enrolled: 6/22/11
• Chaptered: 7/5/11
• Passed: 7/5/11

Caption

Changes the research and development tax credit program to a "rebate"; decreases the program from December 31, 2013 to June 30, 2013; reduces the amount of the rebate by requiring all employees to be counted in the size of the business, rather than only resident employees; and changes it calculation. (gov sig) (EN INCREASE GF RV See Note)

Impact

This bill represents a significant shift in how Louisiana incentivizes research and development within its state borders. By amending the criteria and mechanisms for tax credits, SB 135 aims to encourage more businesses to invest in local research efforts, potentially increasing job creation and economic growth. Additionally, the bill emphasizes the importance of reporting by the Department of Economic Development regarding the allocation of these tax incentives, making it pivotal for maintaining transparency and effectiveness in their application.

Summary

Senate Bill 135 addresses tax credits related to research and development in Louisiana. The bill modifies the existing research and development tax credit program by transforming it into a rebate system, which includes changes in the calculation method for the credits and a reduction in eligibility timelines. The proposed changes aim to streamline the application process and adjust the way tax credits are granted based on the size of the business. For businesses employing more than fifty Louisiana residents, the percentage of tax credits awarded is based on expenditures on qualified research activities and corresponding federal credits.

Sentiment

The sentiment surrounding SB 135 appears supportive among business communities and proponents of economic development, who see the changes as beneficial in promoting investment in research. However, concerns may arise regarding the limitation on tax credits which could affect smaller businesses or those that may not meet the newly defined criteria. Overall, the sentiment seems cautiously optimistic, with stakeholders acknowledging that while the intent is to stimulate growth, careful monitoring of the impacts is necessary.

Contention

Notable points of contention may revolve around the revised eligibility criteria and the newly imposed limitations on receiving multiple tax benefits. Some critics argue that the requirement to count all employees, rather than just resident employees, could disproportionately affect smaller companies, preventing them from benefiting from these tax credits. Moreover, the shortened timeline for claiming these credits may create additional hurdles for businesses seeking to expand their research capabilities, thus leading to debates concerning the balance of fostering innovation while ensuring equitable access to benefits.