HLS 23RS-885 ORIGINAL
2023 Regular Session
HOUSE BILL NO. 491
BY REPRESENTATIVE MARCELLE
TAX/STATE: Repeals the automatic reduction in individual income tax rates and the
corporation franchise tax rate if certain revenue thresholds are met
1 AN ACT
2To repeal R.S. 47:32.1 and 601.2, relative to income and corporation franchise taxes; to
3 repeal the automatic rate reduction triggers for individual income tax and corporation
4 franchise tax; to provide for an effective date; and to provide for related matters.
5Be it enacted by the Legislature of Louisiana:
6 Section 1. R.S. 47:32.1 and 601.2 are hereby repealed in their entirety.
7 Section 2. This Act shall become effective upon signature by the governor or, if not
8signed by the governor, upon expiration of the time for bills to become law without signature
9by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If
10vetoed by the governor and subsequently approved by the legislature, this Act shall become
11effective on the day following such approval.
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)]
HB 491 Original 2023 Regular Session Marcelle
Abstract: Repeals the automatic reductions in the individual income tax rates and the
corporation franchise tax rate if certain revenue thresholds are met.
Present law provides for a tax to be assessed, levied, collected, and paid upon the taxable
income of an individual at the following rates:
(1)1.85% on the first $12,500 of net income.
(2)3.5% on the next $37,500 of net income.
(3)4.25% on net income in excess of $50,000.
Page 1 of 2 HLS 23RS-885 ORIGINAL
HB NO. 491
Present law (R.S. 47:601 et seq.) establishes the corporation franchise tax which is levied
on every domestic and foreign corporation exercising its charter, qualified to do business,
or actually doing business in La. The corporation franchise tax is also levied on any
domestic or foreign corporation owning or using any part of its capital, plant, or other
property in La.
Present law provides, beginning Jan. 1, 2023, that the rate of the tax shall be $2.75 per
$1,000 of taxable capital above $300,000.
Proposed law retains present law.
Present law requires the reduction of each individual income tax rate if, beginning April
1, 2024, and each April first thereafter through 2034, the prior fiscal year's actual individual
income tax collections as reported in the state's accounting system exceed the actual
individual income tax collections for the fiscal year ending June 30, 2019, adjusted annually
by the growth factor provided for in present constitution. If the conditions in present law are
met, individual income tax rates are reduced beginning the following January first.
Present law requires the reduction of the corporation franchise tax rate if, beginning April
1, 2024, and each April first thereafter the prior fiscal year's actual corporation income and
franchise tax collections as reported in the state's accounting system exceed the actual
corporation income and franchise tax collections for the fiscal year ending June 30, 2019,
adjusted annually by the growth factor provided for in present constitution. If the conditions
in present law are met, corporation franchise tax rates are reduced beginning the following
Jan. first.
Present law requires the reduced rate of these taxes to be calculated by multiplying each
current rate by the difference between one and the percentage change in each of these tax
collections in excess of the tax collections for each of these taxes for Fiscal Year 2018-2019
adjusted annually by the growth factor as provided for in present constitution. Further
prohibits this reduction unless both of the following conditions are met:
(1)The prior fiscal year's actual total tax, licenses, and fees exceed the actual total tax,
licenses, and fees for Fiscal Year 2018-2019, adjusted annually by the growth factor
provided for in present constitution.
(2)The Budget Stabilization Fund balance as determined by the treasurer is at least 2.5%
of the total state revenue receipts from the prior fiscal year.
Proposed law repeals present law.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Repeals R.S. 47:32.1 and 601.2)
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