Louisiana Senate Bill SB138

Louisiana 2015 Regular Session

• Introduced: 4/2/15
• Refer: 4/2/15
• Refer: 4/13/15

Caption

Authorizes taxing authorities to decline to collect property tax on inventory held by manufacturers, distributors, and retailers if the taxing authority accepts a payment provided by law in lieu of the ad valorem taxes. (1/1/16)

Impact

If enacted, SB138 would amend R.S. 47:1951 to allow local taxing authorities more discretion regarding the collection of property taxes on certain types of inventory. This could potentially streamline the tax process for businesses operating in the state, potentially improving cash flow and encouraging investment in inventory. Furthermore, it would specifically designate public service properties held by these businesses as subject to the new provisions, ensuring that these categories are included in the legislation.

Summary

Senate Bill 138, introduced by Senator Allain, seeks to authorize taxing authorities in Louisiana to decline the collection of property taxes on inventory held by manufacturers, distributors, and retailers, contingent on these authorities accepting a designated payment in lieu of the ad valorem taxes that would otherwise be due. The bill specifically amends existing state laws regarding property taxation while introducing new provisions that are expected to provide tax relief to businesses holding inventory.

Sentiment

The sentiment around SB138 appears to be generally positive among business groups and lawmakers who advocate for reducing the tax burden on businesses. Proponents argue that the bill would facilitate economic growth by making it easier for companies to manage their inventory without facing prohibitive tax costs. However, the proposal has also raised concerns regarding its impact on local revenues, as declining to collect taxes on inventory could reduce funding for public services that rely on these tax revenues.

Contention

While the primary focus of SB138 is to ease taxation on inventory, some contend that it may contribute to an imbalance in local government funding. Critics have raised concerns that allowing for such exemptions could place additional strain on local budgets, necessitating either cuts in services or increases in other taxes. This ongoing debate underscores the tension between supporting local business initiatives and ensuring adequate funding for community needs, emphasizing the complex implications of tax policy changes in the state.