Incentives

Industrial Tax Exemption Program

The Industrial Property Tax Exemption abates, up to ten years, local property taxes (ad valorem) on a manufacturer’s new investment and annual capitalized additions.

This exemption applies to all improvements to the land, buildings, machinery, equipment and any other property that is part of the manufacturing process. The land itself is not eligible for tax exemption.
NOTE: Requires advance notice be given to the Louisiana Office of Commerce & Industry.

The Facts

This is Louisiana’s original incentive program, for capital investments, and is for manufacturers only. It may be used by manufacturers new to the State as well as new investments and miscellaneous capital additions to existing facilities in Louisiana.

An Advance Notification Form and a $100 fee must be filed and received by the Office of Business Development, Business Incentives Division(BI) prior to starting construction, purchasing, installing equipment, or hiring. The Advance Notification may be completed on-line at Louisiana E-Mall (credit card required)

Eligibility

The Industrial Property Tax Exemption abates, up to ten years, local property taxes (Ad Valorem) on a manufacturer’s new investment and annual capitalized additions. This abatement applies to all improvements to the land, buildings, machinery, equipment, and any other property, that is part of the manufacturing process. Granting this incentive must be considered to be in the best interest of the State of Louisiana by the Board of Commerce and Industry. Tax exempt property must remain on the plant site at all times. The land itself is not tax exemptible.

Benefits

One year benefits of this program are calculated as follows:
One year benefit = Cost of Capital Additions (less obsolete/replaced equipment)
x 15 percent (business assessment rate)
x Millage rate*
= Property Tax Exemption (for one year)
*(Property tax millage can be obtained from the Parish Assessor’s office.)

Application Procedure

• A manufacturer applying for this program must submit an Advance Notification Form if an individual project is to be greater than $5 million, or the business is also applying for Enterprise Zone benefits for the same project. The Advance Notification Form must be filed prior to purchasing (installation of the equipment in-state) or the beginning of construction. The Advance Notification may be completed on line at Louisiana E-Mall Note: a credit card is required.
• A manufacturer may submit an application with an accumulation of Miscellaneous Capital Additions (MCA) for a compilation of small capitalized expenditures (projects) which are completed by the end of a calendar year and not greater than $5 million per application. MCA applications must be postmarked no later than March 31 (October 31 for Orleans Parish) of the year following the year these expenditures were made. Each MCA application may not exceed $5 million. More than one MCA application may be submitted per year.
• Contracts may be granted for a maximum of 5 years. An option to renew the exemption for an additional 5 years is available. Note: An exemption cannot be granted for more than a total of ten years on any investment.
• All applications which include replacement equipment must reduce the application amount by subtracting the cost of the original item from the new replacement item(s).