Provides a credit against state income tax for sales taxes paid by contractors of state public works projects purchasing materials for the public work in-state. (8/15/11)
Impact
Should SB234 be enacted, it would have a significant fiscal impact on state tax revenue by reducing the income and franchise tax burdens on contractors. This is expected to enhance investment in public works, leading to potentially lower project costs and more jobs within the state. By incentivizing purchases from local suppliers, it could stimulate local economies, creating a multiplier effect as more funds circulate within the state.
Summary
Senate Bill 234, introduced by Senator Willard-Lewis, proposes a tax credit applicable to Louisiana's income and corporation franchise taxes. This credit is specifically directed towards contractors who purchase materials and supplies for public works projects within Louisiana. By allowing contractors to claim a credit for the state and local sales taxes they pay, the bill aims to encourage local sourcing of materials, thereby supporting the state's economy and promoting the use of local suppliers in public contracts.
Sentiment
The sentiment surrounding SB234 has been largely positive among stakeholders who advocate for enhancing local economic development. Supporters believe that the bill represents a pragmatic approach to foster ties between state-funded projects and local businesses, which could result in increased competitiveness. However, there is also concern from some fiscal conservatives about the long-term implications for state revenue and whether such a tax credit could incentivize inefficiency or reduced competition among suppliers.
Contention
Notable points of contention have arisen primarily around the potential consequences of the tax credit. Critics argue that while the intent to support local businesses is commendable, it could inadvertently lead to higher costs for public works projects if contractors feel a reduced pressure to seek out competitive pricing. Furthermore, the effectiveness of the credit is under scrutiny, with questions regarding how it will be implemented and monitored to ensure it achieves the desired economic benefits.
Provides a tax credit against individual state income tax for the amount of sales tax paid by homeowners when purchasing green materials for residential home building or remodeling. (8/15/11) (OR DECREASE GF RV See Note)
Provides for the rate of the state sales and use tax and for exemptions, exclusions, credits, and rebates claimed against sales and use taxes; and provides for a flat rate of income tax for individuals, estates, and trusts, increases the standard deduction, and modifies or repeals certain income tax deductions and credits (Items #5, 6, and 8) (EN SEE FISC NOTE RV See Note)
Provides a flat corporation income tax rate and eliminates the usage of certain tax credits against corporation income tax. (gov sig) (OR -$144,000,000 GF RV See Note)
Requests study of a tax credit against individual state income tax for the amount of sales tax paid for certain residential home building or remodeling.
Repeals state taxes levied on the taxable income of individuals and corporations and repeals tax credits, exemptions, deductions, and exclusions (OR DECREASE GF RV See Note)
Requests that the Bd. of Regents and the State Bd. of Elementary and Secondary Education, with the Taylor Foundation, La. Office of Student Financial Assistance, public postsecondary education management boards, and certain others, study certain issues relative to TOPS
Requests the Louisiana Workforce Commission and the Louisiana Department of Veterans Affairs to study employment practices and professional licensing requirements to benefit veterans in the workforce
Creates a task force to study meaningful oversight of the professional healthcare licensing boards statutorily created within the Department of Health and Hospitals.