Provides for the levy of state use tax on the purchase of property and services which are used to be manufactured into items for use in "orbital environments" 500 miles above earth's surface if the sale does not occur in the state and dedicates all state tax collected to make grants to such manufacturers. (10/1/11) (EG DECREASE GF RV See Note)
The tax proceeds are mandated to be credited to the Orbital Manufacturing Development Fund, which is administered by the Louisiana Economic Development Corporation. This fund is intended to support manufacturers through grants, thereby incentivizing the development of technologies and products related to space exploration and production. By providing financial resources to manufacturers engaged in this cutting-edge industry, the state aims to position itself favorably in the growing space economy, potentially enhancing economic development in Louisiana and attracting outside investments.
SB258, introduced by Senator Willard-Lewis, establishes a state use tax on property and services that are used to manufacture items for orbital environments—defined as items intended for service beyond 500 miles above the earth's surface. This bill is pivotal in establishing a tax that specifically applies when sales do not occur within state lines, aiming to foster growth in the emerging market of space-related manufacturing. It creates a fiscal structure that channels the proceeds from this tax to a dedicated fund aimed at supporting manufacturers in the field of orbital manufacturing.
The sentiment surrounding SB258 appears to be cautiously optimistic among industry advocates who see it as a significant step toward establishing Louisiana as a player in the burgeoning space industry. Supporters argue that the tax initiative will not only promote local manufacturing but also create jobs and stimulate economic diversity. However, there are concerns regarding the complexity of implementing such tax measures for a niche market, as well as the implications on existing tax structures within the state.
One notable point of contention is the potential for manufacturers receiving grants to be precluded from challenging tax assessments based on delivery locations. This aspect could generate debate regarding tax equity and the rights of businesses within the state. Additionally, discussions around the adequacy of the funds and their management through the Louisiana Economic Development Corporation could lead to scrutiny over how effectively these funds are utilized to truly benefit the targeted industries.