Louisiana recently enacted several new incentives to encourage business investment in the state. Effective date is July 1, 2012.
The most unique among these discretionary tools is the Competitive Projects Payroll Incentive, which provides up to a 15% rebate of new job payroll annually for up to 10 years. Qualifying firms include durable goods manufacturers (e.g., automotive, aerospace, computers, etc.), pharmaceutical producers, gas-to-liquid conversion projects, and data services. Other sectors may be added. Projects receiving this incentive also qualify for a 4% sales/use tax rebate on materials, machinery, furniture, or equipment or a 1.5% refundable investment tax credit.
The recently enacted Corporate Headquarters Relocation Program provides a 25% rebate on facilities and relocation costs (e.g., moving expenses, equipment costs) to be claimed in equal parts over five years. In order to qualify, a firm's payroll of new direct corporate jobs must be twice the average private-sector wage in the parish where located or $60,000 annually, whichever is lower. The rebate is subject to approved contract terms.
Additionally, Louisiana's new Corporate Tax Apportionment Program provides a single-sales factor apportionment (already available to all manufacturers in the state) to corporate headquarters, logistics/warehousing, data centers, clean technology, destination healthcare, R&D operations, renewable energy, digital media and software development, and other target sectors. The exemption is provided for up to 40 years, subject to approved contract terms.
Finally, the new Property Tax Exemption for Non-manufacturing Terms will take effect at the beginning of 2013 if approved by voter referendum in November. This incentive provides a 10-year exemption for corporate headquarters, distribution facilities, data services facilities, R&D operations, and digital media and software development centers where associated capital investment will be at least $25 million, at least 50 new direct jobs will be created, and a majority of sales/customers will originate outside the state. The first $10 million or 10 percent of fair market value, whichever is greater, will not be exempted from property taxes. The incentive will be offered in parishes that voluntary opt in. It will be provided for 10 years, subject to contract terms approved by the Board of Commerce and Industry.