The Louisiana House of Representatives it set to consider a plan to address the state’s budget deficit and help prevent further cuts to higher education and health care by closing corporate tax loopholes.
Some portions of the plan were included in the original Jindal tax package.
The tax loopholes to be addressed include the following:
1) Film tax credits: exclude the salaries of certain state workers over 1M as well as certain out of state infrastructure in calculating the film tax credit base.
2) Enterprise Zone: reform the Enterprise Zone program by disallowing credits by certain retail companies outside of an Enterprise Zone, require eligible companies to provide full time positions and hire a greater percentage of area disadvantage workers.
3) Solar Credit: Limit the solar credit program to only apply to one installation per residence.
4) Vendors Compensation: Require companies receiving vendor’s compensation to be small businesses with retail sales of less than $1.2 million annually. Big box stores have adequate resources to collect and remit sales tax without being paid by the state.
5) Severance Tax on Inactive wells: Modify the severance tax exclusion program for inactive wells by collecting tax on existing wells in exchange for extending the program, program change suggested by oil and gas industry.
6) Tax collections: increase sales tax collection from delinquent taxpayers by offering a two year amnesty period for which taxes could be paid without penalties.
Also collect existing use tax on Internet transactions.
It is projected that these tax loophole modifications, coupled with additional revenues projected by the Revenue Estimating Conference, will help cushion the budget deficit by approximately $300 million, without having to cut or rely on one time money.
The House is expected to consider a vote on these changes as early as tomorrow.