Louisiana House Bill HB160

Louisiana 2021 Regular Session

• Introduced: 3/19/21
• Refer: 3/19/21
• Refer: 4/12/21

Caption

Provides for the eligibility for the Angel Investor Tax Credit Program (OR DECREASE GF RV See Note)

Impact

The impact of HB 160 on state laws centers around the expansion of eligible investments and amendments to the recapturing mechanism of tax credits. By allowing guarantees from the entrepreneurial businesses, this bill facilitates a shift towards a more supportive economic environment for startups and small businesses. Additionally, it maintains a cap on annual tax credit distribution but allows for carryover of unused credits, further enabling investment continuity. This change aims to stimulate economic growth within the state, particularly in regions looking for entrepreneurial development.

Summary

House Bill 160 seeks to amend the existing Angel Investor Tax Credit Program in Louisiana, expanding the types of investments that qualify for this incentive. The bill allows for investments that are secured or guaranteed by the Louisiana Entrepreneurial Business itself to qualify, which previously only permitted high-risk investments without such guarantees. The move is intended to encourage investor participation and bolster funding for local businesses by increasing their investment security, potentially attracting more funds into the entrepreneurial sector.

Sentiment

Sentiment around the bill appears largely positive among proponents, including business advocacy groups and investors who see the changes as beneficial for fostering a more robust investment climate in Louisiana. However, there may exist some skepticism regarding the potential for less accountability within the more flexible credit system, especially concerning the recapture of tax credits upon investment transfer. Overall, the sentiment among business stakeholders leans towards optimism as it offers an opportunity for broader participation in the entrepreneurial landscape.

Contention

Some points of contention in discussions surrounding HB 160 include concerns over the balance between providing incentives for investors and ensuring that necessary oversight and accountability measures remain in place. Critics argue that relaxing credit requirements could lead to misuse or the exploitation of the program if not adequately monitored. There is apprehension that the broader eligibility for secured investments may undermine the program's original intention to promote truly 'at-risk' investments in innovative business ventures.