Capitol Views by Maginnis: Tax break expansion proposed for major projects
A proposed constitutional amendment would expand the kinds of new businesses that could be exempt from local property taxes. On its way to the Senate floor are companion bills to add a new category for non-manufacturing commercial investments to those eligible for the 10-year industrial tax exemption. With at least a $25 million investment and 50 percent of company sales out of state, eligible projects would include corporate headquarters, distribution facilities, data services facilities, research-and-development operations, and digital media and software development centers. The legislation also calls for the first $10 million of fair market value (or 10 percent, whichever is greater) invested in the project to be taxed normally. “This is a very surgically targeted effort,” said Economic Development Secretary Stephen Moret, who said in his four and a half years as economic development secretary he could not think of three projects that would have met the proposed new eligibility. He said Louisiana is at a strong disadvantage competing for such large-scale projects now because local business property taxes are double those in average Southern states.
Participation would be voluntary for local governments and would require the approval of the parish governing authority, sheriff, assessor, school board and municipalities. The only opposition to HB 674 and 694 came from state assessors, whose counsel Bryan Eddington cited concerns over lawsuits for discriminatory practices, depending on the kinds of businesses approved, and the lack of oversight by local bodies once they opt into a project. Read the full column here for additional coverage on a push to repeal paperless tax refunds in the state.
Editors note: This story has been changed since its original publication.
(John Maginnis will publish a daily update throughout the legislative session on Daily Report PM. The report is also available to LaPolitics Weekly subscribers on the Subscribers Only page at LaPolitics.com. Registration is available on the homepage.)
Louisiana Public Broadcasting is providing a daily video update featuring highlights of the session, which you can see beginning at 6 p.m. here.
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A long way to go