Louisiana Senate Bill SB89

Louisiana 2015 Regular Session

• Introduced: 4/1/15
• Refer: 4/1/15
• Refer: 4/13/15

Caption

Removes the refundable tax credit for ad valorem property taxes paid on natural gas held, used, or consumed in providing natural gas storage services or operating natural gas storage facilities. (gov sig)

Impact

The removal of the credit is expected to impact the operations of natural gas storage service providers significantly. By eliminating this tax benefit, the financial burden on these entities could increase, potentially leading to higher operational costs. This shift could have broader implications for the energy sector in Louisiana, specifically regarding pricing competitiveness and investment in storage facilities within the state.

Summary

Senate Bill 89, introduced by Senator Adley, aims to amend Louisiana tax law concerning ad valorem property taxes related to natural gas. The bill specifically proposes to eliminate the refundable tax credit for such taxes paid on natural gas held, used, or consumed in providing storage services. This change is scheduled to be effective for all tax years beginning on or after January 1, 2015. The bill retains existing tax credits for manufacturers, distributors, and retailers, indicating a targeted approach towards the natural gas industry in Louisiana.

Sentiment

The sentiment surrounding SB 89 appears to be mixed, reflecting broader concerns about taxation and its impact on the natural gas industry. Supporters of the bill may view it as a necessary step towards revenue generation for the state, while opponents likely express concern about the increased financial constraints imposed on the natural gas sector. This division highlights the ongoing tension between fiscal policy objectives and the need to maintain a competitive landscape for energy providers.

Contention

Key points of contention surrounding SB 89 focus on its potential economic impact on the natural gas industry and the broader implications for energy pricing in Louisiana. Critics argue that the removal of the tax credit could discourage investment in natural gas infrastructure and lead to higher costs for consumers. Proponents might argue that the state needs to prioritize revenue from taxation over subsidies, suggesting that such measures could ultimately benefit state resources, despite the potential short-term costs to energy producers.