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)
Impact
The passage of HB 408 is expected to create a more supportive framework for small businesses engaged in research and development by alleviating certain administrative burdens previously imposed by the Department of Economic Development. The bill stipulates that small businesses receiving state grants will not be limited by certain existing restrictions when claiming other incentives. This adjustment could encourage more entities to apply for both state and federal grants, thereby enhancing the potential for economic growth and innovation within the state.
Summary
House Bill 408 seeks to amend Louisiana's laws relating to the research and development tax credit, specifically enhancing incentives for small businesses that receive federal grants from programs such as the Small Business Technology Transfer Program and the Small Business Innovation Research Grant. This bill proposes a tax credit amounting to thirty percent of the award received during the tax year, allowing these businesses to benefit significantly from federal support aimed at innovation and development. By directly addressing how these incentives are administered, the bill aims to foster a more favorable environment for research and development activities in the state.
Sentiment
Overall, there is a positive sentiment surrounding HB 408 among legislators and stakeholders who advocate for greater support of research and development initiatives. The bill is generally viewed as a step toward enhancing the state's competitiveness and attractiveness for businesses engaged in innovative activities. Supporters argue that easing access to tax credits will stimulate economic growth and job creation through increased investment in research and development.
Contention
While the response to HB 408 has been largely favorable, some concerns have been raised about the potential for reduced scrutiny over the allocation of tax credits. Critics argue that exempting certain recipients of tax credits from detailed examinations could lead to misuse or inefficiencies in how public resources are utilized. Debates have surfaced regarding the balance between providing incentives to spur economic development and ensuring accountability in the use of taxpayer funds.
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)
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)
Establishes termination dates for certain tax credits and incentive programs administered by the Department of Economic Development. (gov sig) (EN INCREASE GF RV See Note)
Requires verification of qualified expenditures for certification of certain tax credits by the Dept. of Economic Development (EN +$4,762,000 SG RV See Note)