DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 359 Engrossed 2017 Regular Session Ivey
Abstract: Changes the rates and brackets for purposes of calculating individual income tax liability
from a graduated rate system to a single flat rate of 4% and further authorizes a reduction to
a flat 3% if certain conditions are met and modifies certain credits and deductions.
Present law provides for a tax to be assessed, levied, collected, and paid upon the taxable income of
an individual at the following rates:
(1)2% on the first $12,500 of net income;
(2)4% on the next $37,500 of net income;
(3)6% on net income in excess of $50,000.
Proposed law reduces individual income tax rates as follows:
(1)From 2% on the first $12,500 of net income to 0% on the first $12,500 of net income.
(2)From 4% on the next $37,500 of net income and 6% on net income in excess of $50,000 to
4% on net income in excess of $12,500.
Present law provides that in cases where taxpayers file a joint return of husband and wife, the
combined tax shall be twice the combined tax of single filers.
Proposed law retains present law.
Present law provides that all personal exemptions and deductions for dependents allowed in
determining federal income tax liability shall be allowed in determining La. tax liability. Further
provides for a combined personal exemption of $4,500 for single, individual filers, $9,000 for
married, joint filers, $4,500 for married, separate filers, and $9,000 for filers who are the head of
household.
Proposed law repeals present law.
Present law authorizes a credit of $400 for each dependent who meets certain criteria.
Proposed law repeals present law. Present law authorizes an additional deduction of $1,000 for each allowable exemption in excess of
those required to qualify for the exemption allowable under present law.
Proposed law repeals present law.
Present law requires the secretary to establish tax tables that calculate the tax owed by taxpayers
based upon where their taxable income falls within a range that does not exceed $250. Further
requires the secretary to provide in the tax tables the combined personal exemption, standard
deduction, and other exemption deductions in present law which is deducted from the 2% bracket.
If the combined exemptions and deductions exceed the 2% bracket, the excess is deducted from the
4% bracket, and then the 6% bracket.
Proposed law deletes the provisions authorizing the combined personal exemption, standard
deduction, and other exemption deductions to be deducted from the income tax brackets.
Present law authorizes a deduction from individual income taxes for excess federal itemized personal
deductions. Excess federal itemized personal deductions is defined to mean 100% of the amount
by which the federal itemized personal deductions exceed the amount of federal standard deduction
designated for the filing status used for the taxable period on the individual income tax return.
Proposed law changes present law to limit the deduction to charitable contributions in excess of the
first $12,500 of excess federal itemized personal deductions for single filers and $25,000 for
taxpayers filing joint returns.
Present law provides for an individual income tax credit in an amount equal to 3.5% of the amount
of the taxpayer's federal earned income tax credit authorized under Section 32 of the Internal
Revenue Code.
Proposed law increases the amount of the state credit from 3.5% to 7% of the federal tax credit.
Applicable to all taxable periods beginning on and after Jan. 1, 2018.
Proposed law with respect to the reduction in the individual income tax rate to a flat 4% rate shall
be effective on Jan. 1, 2018. Proposed law provides for the further reduction of the flat individual
income tax rate from 4% to a flat rate of 3% if the proposed amendment of Article VII of the
Constitution of La. contained in the Act which originated as House Bill No. 356 of the 2017 R.S. of
the Legislature is adopted at a statewide election and becomes effective.
Effective Jan. 1, 2018, if the proposed amendment of Article VII of the Constitution of Louisiana
contained in the Act which originated as HB No. 356 of this 2017 R.S. of the Legislature is adopted
at a statewide election and becomes effective and if the Acts which originated as HB Nos. 357, 358,
360, 361, 362, 363, and 364 of this 2017 R.S. of the Legislature are enacted and become effective.
(Amends R.S. 47:32(A), 79, 293(3)(intro. para.), 295(B), 297.8(A); Repeals R.S. 47:294) Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Ways and Means to the original
bill:
1. Adds contingent effectiveness on Jan. 1, 2018, for proposed law if the proposed
amendment of Article VII, contained in the Act that originated as HB No. 356 of this
2017 R.S. of the Legislature is adopted at a statewide election and HB Nos. 357, 358,
360, 361, 362, 363, and 364 of this 2017 R.S. become effective.