Louisiana Economic Development State Business Incentives
The State of Louisiana offers several business incentives which are listed below with a brief explanation. For all incentives, an advance notification form and fees must be completed prior to beginning construction, hiring, or purchasing equipment.
Economic Incentives for Businesses of All Sizes
Enterprise Zone Tax Credit Program
Provides a one-time $2,500 tax credit per certified net new job, and either a 4% sales/use tax rebate on capital expenditures or an investment tax credit equal to 1.5% of qualifying expenses.
- Must increase employment within specified time frame
- Must hire 35% of new workers from one of four targeted groups
Quality Jobs Cash Rebate
Provides 5% or 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. Must fall within one of the state's target industries or Have total annual out-of-state sales of at least 50%.
Restoration Tax Abatement/Property Tax Abatement
Provides five-year 100% abatement for the rehabilitation of an existing structure based on assessed valuation of property prior to beginning of improvements. Must be located in a qualifying district and approved by local governing authority. Does not exempt the acquisition cost of the structure.
Industrial Tax Exemption Property Tax Abatement
Provides a 100% property tax abatement for up to 10 years on manufacturer's qualifying capital investments. Applies only to capital investments by Louisiana manufacturers. Property must remain on the site at all times.
Sound Recording Investor Tax Credit Program
Provides a 25% refundable tax credit on qualified expenditures for sound recording productions. Must spend at least $15,000 in Louisiana.
Research & Development Tax Credit Program
Provides up to a 40% tax credit for Louisiana businesses (based on employment) that conduct research and development activities in Louisiana. Must have incurred federal research and development expenses and/or received SBIR/STTR grant(s)
Digital Media Incentive Tax Credit Program
Provides a 25% tax credit on qualified production expenditures and a 35% tax credit for Louisiana resident labor expenditures. Must be a digital interactive media production in Louisiana. Excludes largely static Internet sites and products regulated under the Louisiana Gaming Control Law.
Motion Picture Investor Tax Credit Program
Provides a tax credit of 30% on qualified production expenditures and an additional 5% tax credit for Louisiana resident labor expenditures. Must spend at least $300,000 on motion picture production in Louisiana.
Live Performance Tax Credit Program
Provides a tax credit of up to 25% on qualified production or infrastructure development expenditures; additional credits available for payroll and transportation expenditures. Must spend at least $100,000 on live performance production or infrastructure projects in Louisiana.
Louisiana Faststart™ Workforce Development Program
Provides workforce recruitment, screening and training to new and expanding Louisiana companies at no cost. Any manufacturing, digital media, corporate headquarters, warehouse and distribution, research and development or other strategic facility must commit to creating at least 15 jobs. Service providers must commit to creating at least 50 jobs.
Economic Development Award Program Loan/Grant Program
Provides funding for publicly owned infrastructure in support of business development projects. Must be a public or quasi-public state entity requesting a minimum of $50,000. Must create or retain at least 10 permanent jobs in Louisiana.
Technology Commercialization Credit and Jobs Program
Ttax credit program provides 40% refundable tax credit on costs related to the commercialization of Louisiana technology and a 6% payroll rebate for the creation of new direct jobs. Must commercialize a technology developed in Louisiana. Must partner with a Louisiana higher education institute or be a governmental research institution.
Modernization Tax Credit Program
Provides a 5% refundable state tax credit for manufacturers modernizing or upgrading existing facilities in Louisiana. Must improve entire facility's or specific unit's efficiency by 10% or more or Facility must be in competition for capital expenditures within a company's established capital expenditure budget plan.
Special Incentives for Small Businesses
Small Business Loan Program
Loan assistance program provides up to 75% loan guarantees or state direct loan participations up to 40% to facilitate capital accessibility. Must be a Louisiana small business (as defined by SBA). Must have a business plan and a bank willing to fund the loan.
Micro Loan Program
Loan assistance program provides up to 80% loan guarantee and state direct loan participations up to 50% for banks that fund loans of $5,000 to $50,000 to small businesses. Must be a Louisiana small business (as defined by SBA).
Bonding Assistance Program
Loan assistance program provides up to 25% loan guarantee for qualifying small contractors bidding on private or public jobs. Must be certified in Small and Emerging Business Development Program. Must complete Louisiana Contractors Accreditation Institute or have LED waiver.
Provides veteran-owned and disabled, service-oriented veteran-owned small businesses with greater potential for access to state procurement and public contract opportunities.
Mentor-Protégé Tax Credit Program
Provides up to $50,000 in tax credits per year for participating large construction firms that provide technical assistance to protégé construction firms Must be certified active in SEBD program or registered in the state's Hudson Initiative Program (protégé firm)
Quality Jobs Program
Louisiana's Quality Jobs Program grants businesses engaged in manufacturing or other basic industries cash rebate up to 6% of its annual gross payroll. Qualifying companies must have a minimum annual payroll of $500,000 ($250,000 for less than 50 employees), pay wages of 1.75 the minimum wage, and provide 85% insurance coverage.
The program can be used in conjunction with the Industrial Property Tax Exemption Program. This program also rebates sales taxes paid on materials and equipment purchased during the construction phase of the project.
Industrial Property Tax Exemption Program
Louisiana's Industrial Property Tax Exemption Program exempts new manufacturing facilities and expansions from all property taxes for up to ten years. Program benefits can be combined with those of other programs, such as the Enterprise Zone or Quality Jobs programs.
Enterprise Zone Program
Louisiana's Enterprise Zone Program provides tax credits and other incentives to businesses locating in officially designated Enterprise Zones. EZs are urban or rural areas of high unemployment, low income, and/or where a large number of residents are receiving some form of public assistance.
The program offers tax credits of $2,500 per new job and state sales tax rebates on purchases of materials and equipment during the construction phase.
Inventory Tax Credit
The Inventory Tax Credit provides a 100 percent refundable tax credit against state corporate income and franchise taxes, or a cash rebate if the tax liability is not that large, for inventory taxes paid to political subdivisions.
Corporate Jobs Tax Credit Program
The Corporate Jobs Tax Credit Program provides credits of up to $225 per new worker. The credits can be used to satisfy state corporate income taxes and are an alternative option to the benefits of the state's Industrial Property Tax Exemption program and Enterprise Zone program benefits.
Economic Development Assistance Program
(EDAP) This program, administered by the Department of Economic Development, provides grants for publicly-owned infrastructure to assist industrial or business development projects that promote economic development and that require state assistance.
Biotechnology Sales/Use Tax Exemption
Under the plan, equipment classified under the NAICS biotechnology category will be exempted from all state and local sales and use taxes.
Customized Software Tax Phaseout
Customized software developers in Louisiana are exempt from state sales and use taxes (local is optional.) The tax exemption will be phased in beginning with a 25% exemption in July 2002 through June 2003, with an additional 25% exemption added over the succeeding years until 100% is exempted beginning in July 2005.
Film and Video Production Tax Credit
Allows tax credits on percentage of production costs associated with motion picture production companies producing nationally distributed movies, videos, commercials, television series, etc. The credit is 10% for spending of $300,000 to $1,000,000, and 15% for spending over $1 million.
Film and Video Sales Tax Exemption
Allows exclusion of state sales taxes on items purchased for film projects investing more than $250,000 in the State during a twelve-month period with advance exemption. Does not include exclusion of local tax.
Automotive and Aerospace Industry Tax Credit
The program provides a $5,000 one-time tax credit per new job for companies in the automotive and aerospace industries that participate in the state's Enterprise Zone program.
Rural Tax Increment Financing
The change in the TIF Program allows parishes or municipalities with a population of at least 250,000 the ability to offer tax increment financing on sales, use, property, and hotel occupancy taxes.
Cooperative Endeavor Agreements
Allows public funds to be used for cooperative endeavor agreements on privately owned land or buildings for economic development projects, instead of requiring public ownership.
Workforce Development & Training Program
This program provides funding for customized workforce training programs to improve the competitiveness and productivity of Louisiana's workforce and business community, and to assist Louisiana businesses in promoting employment stability.
Incumbent Worker Training Program
Louisiana has a $50 million fund to upgrade the skills of existing workers or to train new employees of resident industry. Local workforce investment boards (WIBs), technical colleges and the LA Department of Labor work together to provide this benefit.
Restoration Tax Abatement Program
The program provides a ten year property tax abatement on the improvements made to commercial and residential properties in designated downtown development districts, economic development districts and historic districts.
Research & Development Tax Credit Program
Companies claiming Federal income tax credit for research activities will now be able to claim credit against state income and corporation franchise taxes up to 8% of the state's apportioned share of increased R & D expenses or 25% of its apportioned share of federal research credit claimed under 26 USCA §41 (alternative incremental tax credit) The Income Tax program will begin in 2003 and the Franchise Tax program will begin in 2004.
Technical Commercialization Credit Program
Companies partnering with Louisiana universities can claim an annual 15% credit against the costs of investment in machinery, equipment and expenditures associated with obtaining rights for the use of technology, including patents, copyrights, licenses, and the leasing of equipment for an initial 4 year program time. Businesses in identified traditional or seed clusters with no more than 225 employees, and not less than 75% of all employees residing in Louisiana, can sell tax credits for 75% of their value to another Louisiana taxpayer.
The state of Louisiana will match the tax rates of a competing state if necessary to retain or recruit 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.
Renewal Community (RC)
Designed to stimulate economic development in distressed communities, the U.S. Housing and Urban Development (HUD) program provides federal tax credits of $1,500 per new or existing employee, in addition to other benefits such as low interest financing, capital gains and more. Louisiana has two rural RCs, in North Louisiana and Central Louisiana, and two urban RCs in Orleans and Ouachita Parishes. See the RC web site at http://www.renewallouisiana.com/. Benefits expire on December 31, 2009.
For more information on all of these programs please click here: www.led.state.la.us