Louisiana House Bill HB98

Louisiana 2016 1st Special Session

• Introduced: 2/19/16
• Refer: 2/19/16

Caption

Amends Act No. 125 of the 2015 Regular Session of the Legislature to provide relative to income and corporation franchise tax credits (Item #10) (OR INCREASE GF RV See Note)

Impact

The modifications brought by HB 98 could reshape the financing landscape for numerous industries operating within the state. By adjusting the tax credit percentages and setting caps on the total credits, the bill aims to limit the fiscal impact while still encouraging investment. There are specific provisions to ensure that credits are earned based on substantial investments, which encourages larger-scale projects and potentially creates job opportunities. The cap on credits is aimed at sustaining state revenue while fostering economic growth.

Summary

House Bill 98 aims to reform tax credits related to income and corporate franchise taxes in Louisiana. Specifically, it amends previous legislation by introducing changes that affect various tax credits available to corporations and individuals for investments in state-certified productions and projects. The bill modifies the rate at which tax credits are granted, with an emphasis on stimulating economic activity through investment in Louisiana's infrastructure and industries, such as film production and green job sectors.

Sentiment

Overall, the sentiment surrounding HB 98 is mixed. Proponents argue that the reforms are necessary to attract investment in critical sectors and ensure the state's economic vitality. They view the capped, targeted approach as a responsible measure that balances the need for incentives with fiscal responsibility. Conversely, critics voice concerns regarding the adequacy of the revised tax credits, suggesting they may not be sufficient to attract or retain businesses. There are also apprehensions that the changes may disproportionately impact smaller companies that rely heavily on tax credits for competitiveness.

Contention

Notable points of contention include discussions about the effectiveness of the proposed changes to tax rates and regulations concerning the timing and application of tax credits. Critics worry that the limitations on credits could hinder growth and investment in emerging industries crucial for the state’s economy. Additionally, the delineation of qualified projects and required certifications for earning credits has raised eyebrows about potential bureaucratic barriers for businesses seeking to utilize the credits effectively.