The Louisiana House of Representatives passed several tax bills Tuesday including one that gives $157 million in tax breaks to oil companies, another that establishes a state sales-tax holiday and a third that offers a modest income tax credit to residents who pay for tutoring for college students taking classes online.
House Bill 29, filed by Rep. Phillip DeVillier, R-Eunice, which would suspend a 12.5% severance tax that oil and gas companies pay on crude fossil fuels extracted from newly-drilled wells or enhanced wells, passed after a floor debate with a 68-22 vote.
The bill, requested by the Louisiana Mid-Continent’s Oil and Gas Association, is estimated to cost taxpayers $157 million over the next five years, according to the legislature’s fiscal office. It allows companies to claim credits on each well for up to 24 months or until the company recovers the amount it spent to drill or enhance the well, whichever comes first.
Unlike other tax breaks such as those under the Industrial Tax Exemption Program, DeVillier’s proposed tax suspension carries no job-creation or residency requirements or investment thresholds in order for a company to qualify. Companies can also claim it in addition to other breaks such as those under ITEP as well as a separate tax credit being proposed in House Bill 78, which would allow local governing bodies such as school boards and sheriffs to accept a lump sum of no more than two years of property taxes from a company and exempt them from taxes for the next nine years. That bill is slated to be considered before the full House on Oct. 12.
In a move aimed at stimulating retail businesses, House lawmakers unanimously adopted House Bill 26, establishing a state sales tax holiday on Nov. 20-21. The holiday suspends most sales taxes except for those on automobile sales and food from restaurants and eateries.
The final tax bill considered Tuesday was House Bill 20, authored by Rep. Rick Edmonds, R-Baton Rouge. It offers a state income tax credit to residents with certain narrowly-defined education expenses related to the COVID-19 pandemic.
“I know we’ve done a lot to help businesses, so I just wanted to give something to the people,” Edmonds said.
The bill offers a credit on “educational coaching services for an in-person facilitator of virtual education delivered by a public or approved nonpublic elementary or secondary school.” The bill would help parents defray the costs of an in-person tutor who assisted with virtual courses for college students. It would only apply if the student being tutored is a qualified dependent and is at least 18 or a high school graduate.
Edmonds said he expects the amount of the credit to be about $100 or $200 per qualified tax filer.