This new federal capital gains tax incentive community development program, established by Congress in the Tax Cuts and Jobs Act of 2017, is designed to drive long-term investments to low-income communities. The new law provides a federal tax incentive for investors to re-invest their capital gains into Opportunity Funds, which are specialized vehicles dedicated to investing in designated low-income areas.
There are 150 census tracts in Louisiana that are qualified opportunity zones. These low-income tracts were nominated by Gov. John Bel Edwards and certified by the Secretary of the Treasury.
LOUISIANA BUSINESS INCENTIVES
Provides up to 6% rebate on annual payroll expenses for up to 10 years; and either a 4% sales/use tax rebate on capital expenditures or an investment tax credit equal to 1.5% of qualifying expenses.
Provides 100% local property tax abatement for up to five years on materials used in new manufacturing and annual capitalized additions related to the manufacturing site and up to an 80% exemption on renewals for an additional three years.
Provides either a $3,500 or $1,000 tax credit for each certified net, new job created and either a 4% sales/use tax rebate on capital expenses or 1.5% investment tax credit for qualifying expenses.
PORT INFRASTRUCTURE TAX CREDIT
Provides private sector investors a credit of up to 100% of their capital expenditures for qualifying projects of $5 million or more at a Louisiana public port.
FastStart provides customized employee recruitment, screening, training development and training delivery for eligible, new or expanding companies — all at no cost.
Provides an up to ten-year abatement of ad valorem property taxes on renovations and improvements of existing commercial structures and owner-occupied residences.
INVENTORY TAX CREDIT
The Inventory Tax Credit provides a 75% refundable tax credit against state corporate income and franchise taxes for inventory taxes paid to political subdivisions. The remaining 25% is to be carried forward against income and corporation franchise tax for up to five years.
The Competitive Projects Payroll Incentive (CPPI) Program provides an incentive rebate of up to 15 percent of a participating company’s new payroll for up to 10 years. Additionally, a participating company will be eligible for either a rebate of state sales and use taxes on capital expenditures or a 1.2 percent project facility expense rebate.
Provides up to a 40% tax credit on qualified research expenditures incurred in Louisiana — with no cap and no minimum requirement.
A refundable tax credit of 28.8 percent for companies that invest in the commercialization of Louisiana technology and a payroll rebate of 4.32 percent for the creation of new direct jobs.
Provides a 25.2% tax credit on qualified payroll for in-state labor and 18% for qualified production expenses for expenditures through June 30, 2018, and a 35% tax credit on qualified payroll for in-state labor and 25% for qualified production expenses for expenditures on or after July 1, 2018.
Provides motion picture productions up to a 30% transferable tax credit on total qualified in-state production expenditures, including resident and non-resident labor. For productions using in-state labor, Louisiana offers an additional 10% payroll tax credit.
COOPERATIVE ENDEAVOR AGREEMENTS
Allows the use of public funds for cooperative endeavor agreements for economic development projects to be used on privately owned land or buildings, instead of need for public ownership for transaction.
The state of Louisiana will match the tax rates of a competing state if necessary to retain a business in the state. Approval by the LA Legislature is required.
INDUSTRY ASSISTANCE PROGRAM
Financially distressed companies anticipated to close in the state might be eligible for tax relief from the state in order to retain jobs and investment. Approval by the LA Legislature is required.
FOREIGN TRADE ZONE 124
The Port of South Louisiana serves as the grantee of Foreign Trade Zone #124. In 2017, FTZ #124 facilitated the employment of 10,600 workers. Because of its location, Foreign Trade Zone 124 currently services six parishes (counties) with two more in the application stage and has 15 zones (some of which are designated as Alternative Site Framework sites).
The Louisiana Economic Development Corporation (LEDC) was established in July 1988 by an Act of the Legislature. LEDC serves as the one reviewer and administrator of the Department of Economic Development’s loan, guaranty, and grant programs. LEDC administers several programs for small Louisiana businesses, ranging from loan guarantees to venture capital.
The Louisiana Public Facilities Authority is a private publicly funded corporation that administers Industrial Revenue Bonds (IDBs) for businesses expanding or relocating to Louisiana.
Louisiana has climbed substantially in major U.S. business climate rankings, with the state now placing higher in every national ranking that it ever did prior to 2008.
Louisiana awarded a 2018 Silver Shovel Award for job creation and business investment impact by Area Development Magazine
#1 | LED FastStart® workforce training program, ranked in 2017 by Business Facilities for the past eight years. Louisiana’s high-profile workforce training program was singled out for excellence in the design and execution of flexible custom screening, training, and recruitment for companies across a range of industries
#1 | Business Facilities’ ranking of Louisiana for Cybersecurity Growth Potential
#2 | Site Selection Magazine‘s rank of Louisiana for infrastructure investment (roads, bridges, airports, pipelines, railroads, corporate, etc.) that supports economic growth
#2 | Southern Business & Development magazine’s rank of Louisiana in the South for the strongest economic development results during 2018, based on the state’s share of leading capital investment and job creation projects
#2 | In the U.S. for states with the most certified sites with 89 LED certified sites
(Louisiana economic development-sponsored certification)
#3 | Business Facilities Magazine ranking of Louisiana for economic growth potential
#4 | In the U.S. for build-ready sites for large industrial projects, totaling 70 development-ready sites (4,500 acres) in 14 parishes
# 4 | Louisiana’s 2016 rank in the nation for its supportive small business environment by Thumbtack.com in conjunction with the Kauffman Foundation
# 4 | In Site Selection Magazine‘s Prosperity Cup 2018 south central region rankings
#7 | In Area Development Magazine‘s annual 2018 Top States for Doing Business.
Ranking in specific categories:
#3 | Leading Workforce Development Programs
#6 | Business Incentive Programs
#6 | Cooperative and Responsive State Government
#6 | Favorable General Regulatory Environment
#7 | Most Improved Economic Development Policies
#9 | Overall Cost of Doing Business
#10 | Shovel-Ready Sites Program
#10 | Access to Capital and Project Funding
Top 10 | Site Selection rank of Louisiana in its 2018 Best States for Business
A+ | In the 2017 survey of small businesses conducted by Thumbtack.com in conjunction with the Kauffman Foundation for small business friendliness