Louisiana House Bill HB710

Louisiana 2013 Regular Session

• Introduced: 4/17/13
• Refer: 4/18/13

Caption

Phases-in a reduction in the amount of certain income tax credits over six years

Impact

The bill is poised to affect various established tax credit programs that currently incentivize businesses and individuals through measures such as the employer tax credit, credits for local inventory taxes, and numerous industry-specific incentives. By reducing the available credits, the state hopes to recalibrate its fiscal framework while retaining essential programs. Proponents of HB 710 argue that this reduction will stabilize state revenue streams, providing necessary funding for other legislative initiatives.

Summary

House Bill 710 aims to phase in a reduction of certain income tax credits and corporation franchise tax credits in Louisiana over a defined period. The legislation seeks to implement a 10% reduction for specific tax years starting in 2014 and progressing to a 20% reduction between 2016 and 2020. After 2020, the amount of tax credit granted will not be subjected to further reductions. This approach reflects a strategy to manage and potentially streamline tax expenditures for the state while balancing revenue needs against fiscal impacts on taxpayers.

Sentiment

The sentiment surrounding HB 710 is mixed among legislators and stakeholders. Supporters advocate for the need to adjust tax credits in light of budgetary constraints, positing that the state should ensure a more sustainable economic policy. Conversely, critics of the bill express concern that the reduction in tax credits may deter investment and economic activity in Louisiana, arguing that communities depend on these incentives for development, job creation, and sustaining economic growth.

Contention

Notable points of contention stem from the potential impact on local economies that benefit from various tax credit incentives. Opponents fear that the reduction could stifle growth in key sectors, such as film production, renewable energy, and local philanthropic initiatives that provide community support. The broader implications of reducing tax credits may lead to longer-term economic repercussions that warrant further examination and discussion among stakeholders to address both immediate fiscal needs and sustained economic vitality.