Louisiana Senate Bill SB177

Louisiana 2013 Regular Session

• Introduced: 4/8/13
• Refer: 4/8/13

Caption

Creates the Rapid Response to Declared Disasters Income Tax Exclusion Act to exclude from gross income certain monies received for services rendered by nonresidents during a declared disaster or emergency. (gov sig) (OR DECREASE GF RV See Note)

Impact

The enactment of SB 177 would represent a significant adjustment in Louisiana's tax landscape, particularly concerning the taxation of income derived from services provided in the wake of disasters. By removing the tax obligation for nonresident individuals and businesses involved in disaster response work, the state hopes to attract more external resources and expertise necessary for effective disaster management and recovery. This change could lead to a quicker restoration of essential services and infrastructure, thereby benefiting the communities adversely affected by disasters.

Summary

Senate Bill 177, known as the Rapid Response to Declared Disasters Income Tax Exclusion Act, aims to amend existing tax laws by providing an income tax exclusion for certain services rendered by nonresident individuals and businesses during declared disasters or emergencies. The bill delineates specific terms and definitions, including 'nonresident businesses' and 'out-of-state employees', clarifying that these entities will not be required to report this income as gross income for tax purposes during a disaster period. The intent of this legislation is to facilitate a more robust and rapid response to disasters by easing the financial burden on out-of-state workers who come to assist in the recovery efforts.

Sentiment

The sentiment surrounding SB 177 appears to be largely supportive among those who recognize the necessity of rapid and efficient disaster response efforts. Proponents argue that the bill will enhance state resilience and recovery capabilities by incentivizing out-of-state professionals to contribute their services without the hindrance of taxation. However, some criticism may arise concerning the potential for local governments to feel overlooked, as the bill primarily focuses on nonresident entities while local scaling capacities and needs are not as directly addressed.

Contention

Despite the overall support for the bill, notable points of contention could emerge, particularly regarding the implications for local taxation policies and the long-term effects of excluding nonresident income from gross revenue streams. Concerns about whether SB 177 might unintentionally impact local businesses competing for disaster recovery contracts exist, as they will not receive the same tax exclusions. Furthermore, the bill includes provisions for taxation on transaction-related expenses for nonresident services, emphasizing a broader discussion about equitable tax treatment in the context of local vs. nonresident contributions during disasters.