LA
Louisiana House Bill HB644

Louisiana 2017 Regular Session

Louisiana House Bill HB644

Introduced
4/18/17  
Introduced
4/18/17  

Caption

Limits the maximum amount of the net operating loss deduction that may be carried over to subsequent years

Impact

The implementation of HB 644 is expected to influence corporate tax liability significantly. By limiting the carryover of net operating losses, it aims to create a more predictable tax environment for the state. This move is likely to generate a short-term increase in tax revenues as businesses may be challenged to offset their losses in future tax calculations. This could also potentially lead to a decrease in taxpayers' abilities to plan for long-term financial downturns, thereby affecting business stability and growth in some sectors of the economy.

Summary

House Bill 644 introduces a significant change to Louisiana's corporate income tax regulations by capping the net operating loss deduction that can be carried over to subsequent years to $10 million. This change seeks to streamline the corporate tax process and establish uniform standards across the state's tax code. The bill effectively disallows any losses exceeding this cap from being deducted in future taxable years, which could have a substantial impact on how corporations manage their financial planning and tax expenditures.

Sentiment

The sentiment surrounding HB 644 appears to be mixed. Supporters argue that it could simplify tax conditions and create a more equitable taxation system for businesses, promoting fairness in corporate taxation. On the other hand, detractors express concerns that limiting the net operating loss deduction may unfairly penalize companies during periods of economic hardship, particularly startups and small businesses that may rely on these deductions for sustainability.

Contention

Notable points of contention surrounding HB 644 include the balance between encouraging business growth and ensuring state revenue. Opponents fear that the $10 million cap could disproportionately impact smaller companies and those in volatile markets, thereby questioning the long-term viability of this tax reform. As businesses adapt to these changes, many stakeholders remain vigilant about the effectiveness of such measures in fostering a conducive business environment while maintaining necessary state revenues.

Companion Bills

No companion bills found.

Previously Filed As

LA HB363

Caps the amount of losses a taxpayer may claim on certain tax returns for the net operating loss deduction and repeals the deduction for certain wage expenses (EG +$14,500,000 GF RV See Note)

LA HB530

Limits the net operating loss deduction associated with income tax

LA HB506

Increases the amount of the net operating loss deduction (RE -$20,300,000 GF RV See Note)

LA HB263

Provides relative to loss years for purposes of the net operating loss deduction for corporate income tax (EN DECREASE GF RV See Note)

LA SB180

Makes the net operating loss deduction nonrefundable, removes the carryback, and authorizes a carryforward of twenty years. (gov sig)

LA HB116

Provides relative to loss years for purposes of the net operating loss deduction for corporate income tax (Item #5) (EN SEE FISC NOTE GF RV See Note)

LA HB153

Provides relative to the net operating loss deduction from corporate income tax (EG -$146,000,000 GF RV See Note)

LA HB423

Removes the carryback provisions for the net operating loss deduction for purposes of the corporate income tax

LA HB395

Eliminates the carryback provisions for the net operating loss deduction for purposes of corporate income tax

LA HB25

Provides relative to the net operating loss deduction for corporate income tax (Item #12) (OR INCREASE GF RV See Note)

Similar Bills

No similar bills found.