Extends the sunset of the research and development tax credit (EG -$1,000,000 GF RV See Note)
Impact
The extension of the R&D tax credit is projected to have a positive impact on businesses employing 50 or more individuals, as well as smaller companies that meet specific eligibility criteria. The tax credits vary by company size, providing a greater percentage to smaller firms, which may need more support to finance their research initiatives. By keeping the tax credits available for a longer period, the bill supports existing companies and may encourage new investments in Louisiana, potentially leading to job creation and economic growth in the tech sector.
Summary
House Bill 480 focuses on extending the sunset period for the research and development tax credit in Louisiana. Originally set to expire on December 31, 2021, the bill seeks to prolong this deadline to December 31, 2025. The R&D tax credit serves as a significant incentive for businesses engaged in increasing technological innovation and research activities. By allowing companies to receive tax credits based on their increased research expenditures, the bill aims to foster an environment conducive to economic development and technological advancement in the state.
Sentiment
The sentiment surrounding HB 480 is predominantly positive, particularly among business leaders and advocates for economic development. Many see the extension of the tax credit as a crucial step to maintaining competitiveness in an age where innovation drives market success. While most discussions highlighted the benefits of the bill, there are cautionary notes regarding the focus on larger employers, suggesting that support should also extend to very small businesses struggling to engage in R&D.
Contention
Notable points of contention arose during discussions regarding the distribution of benefits between larger businesses and smaller firms. While the bill seeks to address this by maintaining different credit percentages based on employee count, some critics argue that additional adjustments could better facilitate inclusivity for very small businesses. The debate centered around how best to encourage innovation while ensuring equitable access to these incentives at all levels of the business community.
Provides relative to the amount of the research and development tax credit and authorizes transferability of the credit under certain circumstances (EN +$300,000 GF RV See Note)
Extends the research and development tax credit program from Dec. 31, 2013, to Dec. 31, 2019, and changes the refundable tax credit to a tax rebate (RE INCREASE GF RV See Note)
Exempts certain research and development tax credit recipients from detailed examinations by the Department of Economic Development (EN SEE FISC NOTE GF EX See Note)