Senate Bill No. SLS 23RS-157, introduced by Senator Allain, proposes significant changes to Louisiana's corporate income tax structure. The bill aims to eliminate the inventory tax credit for corporations and reduce corporate income tax rates by modifying the existing tax brackets. Specifically, the tax rate on the first $50,000 of Louisiana taxable income will decrease from 3.5% to 2%, and the rate on income above $50,000 will be reduced from 5.5% to 4.75%. The bill also removes the applicability of the inventory tax credit against corporate income and franchise taxes, limiting it instead to individual income tax.

The proposed changes will take effect on January 1, 2024, for corporate income tax periods and on January 1, 2025, for corporation franchise tax periods. The bill retains the tax credit for ad valorem taxes paid on inventory but restricts its application solely to individual income tax, thereby eliminating its previous applicability to corporate income and franchise taxes. This legislative move is intended to streamline the corporate tax framework and potentially enhance the business environment in Louisiana.

Statutes affected:
SB19 Original: 47:6006(A), 47:6006(B)(1), 47:6006(B)(2)
SB19 Engrossed: 47:6006(A), 47:6006(B)(1), 47:6006(B)(2)