HLS 20RS-500 ORIGINAL
2020 Regular Session
HOUSE CONCURRENT STUDY REQUEST NO. 1
BY REPRESENTATIVE NELSON
TAX/INCOME TAX: Requests the House Ways and Means and Senate Revenue and Fiscal
Affairs Committees to study the fiscal impact and feasibility of eliminating state
income taxes and the ad valorem tax assessed on certain inventories
1 A CONCURRENT STUDY REQUEST
2To request the House Committee on Ways and Means and the Senate Committee on
3 Revenue and Fiscal Affairs to meet and to function as a joint committee to study the
4 fiscal impact and feasibility of eliminating state income taxes and ad valorem
5 property taxes assessed on certain inventories and to identify alternative sources of
6 funding, reductions or eliminations of certain tax incentives, or other budget
7 efficiencies to account for potential lost revenue and to report the findings of the
8 joint committee to the legislature prior to the convening of the 2021 Regular Session.
9 WHEREAS, each year, the state authorizes many income tax exemptions, exclusions,
10deductions, and credits; and
11 WHEREAS, Louisiana is one of a minority of states that do not exempt inventory
12from ad valorem tax, and, instead, local governments levy and collect ad valorem taxes on
13inventory, and the businesses paying this tax are reimbursed by the state for the amount of
14the tax paid via a partially refundable tax credit on their state income and corporate franchise
15tax returns; and
16 WHEREAS, in Fiscal Year 2018, the state collected approximately $3.269 billion
17in state individual income taxes, $3.892 billion in state sales taxes, and $478 million in
18corporate income and corporate franchise taxes; and
Page 1 of 3 HLS 20RS-500 ORIGINAL
HCSR NO. 1
1 WHEREAS, individual and corporate income tax collections, corporate franchise tax
2collections, and state sales and use tax collections make up a large part of the state general
3fund that is used to fund the operating expenses of state government each year; and
4 WHEREAS, the citizens of Louisiana expect and deserve a stable, transparent, and
5effective government that meets the needs of citizens through high-quality programs and
6efficient services; and
7 WHEREAS, the structure of the state budget continues to limit the ability of the
8legislature and the governor to prioritize critical statewide services; and
9 WHEREAS, there are numerous areas within our state government's tax policies in
10which reforming the current policies and practices will produce savings or additional
11revenues for the state; and
12 WHEREAS, in 2015, the legislature commissioned a tax study to provide the
13legislature with alternatives for a tax structure with predictable and stable revenues that
14promotes competitiveness and is fair and simple; and
15 WHEREAS, the legislature began deliberating the long-term recommendations
16included in the tax study during the interim and the 2016 First Extraordinary Session of the
17Legislature; and
18 WHEREAS, the tax policy initiated in the 2016 First Extraordinary Session of the
19Legislature brought short-term relief for the projected budget deficits; and
20 WHEREAS, the short-term relief serves to bridge the time needed for the legislature
21and stakeholders to continue to work on better budgeting practices and tax policy that can
22provide long-term structural relief from budget deficits as well as a stable and fair tax
23system; and
24 WHEREAS, the legislature should consider long-term tax and budget policies that
25will result in the government lowering the overall tax burden of its citizens while ensuring
26that the state is able to fund vital statewide programs and services for its citizens; and
27 WHEREAS, in order to fully understand all of the issues that may arise related to
28this proposal, the committees should include testimony and input from all stakeholders
29including but not limited to local government officials and assessors, representatives from
30groups that represent citizens that are subject to personal income taxes, representatives from
Page 2 of 3 HLS 20RS-500 ORIGINAL
HCSR NO. 1
1businesses and industries that are subject to inventory taxes, representatives from businesses
2and industries that are subject to corporate or corporate franchise taxes, the Department of
3Revenue, the Division of Administration, and any other interested groups and parties.
4 THEREFORE, the Legislature of Louisiana requests the House Committee on Ways
5and Means and the Senate Committee on Revenue and Fiscal Affairs to meet and to function
6as a joint committee to study the fiscal impact and feasibility of eliminating state income
7taxes and ad valorem property taxes assessed on certain inventories and to identify
8alternative sources of funding, reductions or eliminations of certain tax incentives, or other
9budget efficiencies to account for potential lost revenue, and to report the findings of the
10joint committee to the legislature prior to the convening of the 2021 Regular Session.
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)]
HCSR 1 Original 2020 Regular Session Nelson
Requests the House Ways and Means and the Senate Revenue and Fiscal Affairs committees
to meet and to function as a joint committee to study the fiscal impact and feasibility of
eliminating state income and certain ad valorem property taxes, to identify alternative
sources of funding, reductions or eliminations of certain tax incentives, or other budget
efficiencies to account for potential lost revenue, and to report its findings to the legislature
prior to the convening of the 2021 R.S.
Page 3 of 3