Incentives

The Enterprise Zone

The Enterprise Zone Program is a JOBS incentive program that provides Louisiana income and corporate franchise tax credits to businesses hiring new employees from which 35 percent must be from one of four targeted groups.

In Jefferson Parish, a business does not have to be located in an Enterprise Zone or making capital expenditures, just creating additional jobs. To qualify, a business must add at least five new jobs within 2 years or increase its statewide workforce by 10 percent within one year, whichever is less. A partial sales/use tax rebate or refundable investment income tax credit may be available for construction materials, machinery and equipment purchased during the stated project period. Note: Requires advance notice be given to the Louisiana Office of Commerce & Industry.

The Facts

The Enterprise Zone Program is a JOBS incentive program which creates Louisiana Income and Franchise tax credits and state and/or local sales/use tax rebates to a business that hires at least 35 percent of their new jobs from one of four targeted groups. Enterprise Zones are areas of high unemployment, low income, or have a high percentage of residents receiving some form of public assistance. The Board of Commerce and Industry (Board) is the authority which approves the Enterprise Zone applications. The Office of Business Development, Business Incentives Division (BI) administers this Program.

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.

Eligibility

• Any business, except those engaged in residential development or churches, must be creating a minimum number of net new jobs.
• A business must increase statewide workforce by 10 percent (minimum of 1) within the first 12 months OR create a minimum of 5 net new jobs within the first 24 months of the project/construction start date.

1. All jobs that generate a tax credit must be filled with a Louisiana resident except as provided for in statement #2 below.
2. A maximum of fifty percent (50%) of jobs that qualify for the tax credit may be filled by non-residents of Louisiana provided residency is made within 60 days of hire.
3. 35 percent (35%) of all jobs that generate a tax credit must be a member of one of the program’s targeted groups. (See Certification of Jobs.)

Benefits

Job Tax Credits

1. A one-time $2,500 tax credit is generated for each certified net new job created.
2. A certified new employee receiving Family Independence Temporary Assistance Program (FITAP), an additional $2,500 tax credit, may be generated in the second year of employment.
3. Jobs Tax Credits are used to satisfy State Income and/or Franchise Tax obligations. Special corporations (Such as LLCs and Subchapter S) are allowed to pass the tax credits to the owners. The credits may be used in the year generated or carried forward for up to 10 years.

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Sales/Use Tax Rebate

1. A rebate of State Sales/Use Tax on materials purchased and used in the applicant’s new infrastructure, machinery and equipment purchased during the construction period and used exclusively on site, in that business. This rebate covers the construction period only.
2. Only a portion of the local Sales/Use Tax is available for rebate with a resolution from each local governing authority involved. This resolution must be passed by the local governing authority prior to the application approval. Local sales/use tax dedicated to the schools or bond indebtedness are not eligible for rebates.

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In lieu of the sales/use tax rebate, a refundable investment income tax credit equal to one and one-half percent (1-1/2%) of certain capital expenditures is available.

Application Procedures

• An Advance Notification Form and $100 fee must be filed with the BI PRIOR to starting construction, purchasing, installing equipment or hiring.
• A completed Enterprise Zone Application Form and fee must be filed with BI within three months after the completion of project/construction.
• Copy of Louisiana Department of Revenue Sales Tax Certificate must provided.
• The screening committee will review the application. The Board will take action on the screening committee’s recommendation. After board approval a contract, maximum of five years, is entered into between the board and the applicant.
• An Inspection/Audit Affidavit Form must be submitted with a $100 fee, within six months after completion of construction or returned with the signed original contract, whichever is later.
• The state requests businesses and their contractors receiving State tax rebates or credits to give consideration to Louisiana manufacturers, suppliers, contractors and labor for their project.

Job Certification

35 percent (35%) of all jobs generating tax credits must meet one of the following:

• Residency. A qualifying employee must be a resident of an Enterprise Zone in any parish within the state of Louisiana.
• Receiving some form of public income assistance (WIC, FITAP, etc.) or employment assistance (Louisiana Job Service, Tech College, etc.) within the six months immediately prior to being hired.
• Lacking basic skills. A person who is below the 9th grade proficiency in reading, writing, or math.
• Physically challenged.