November 2024 Special Session on Fiscal Reform

From the perspective of protecting local government autonomy, Louisiana’s third extraordinary session offered both challenges and opportunities. Key reforms allowed Parishes, school boards, and sheriffs to opt into a business inventory tax exemption, providing flexibility but also the risk of reduced local revenue. The shift of certain property tax provisions from the constitution to statute increases legislative control over local tax matters, potentially undermining local decision-making. However, local governments retained their authority to collect inventory tax , preserving some autonomy over critical revenue streams. 

Caps on severance tax proceeds dedicated to Parishes were removed. Local governments retain the option to collect sales taxes on manufacturing machinery and equipment and prescription drugs.

Key measures of the overall legislative effort included reduction of individual and corporate income tax rates, elimination of corporate franchise tax, restructure of the property tax system, and merger of stabilization funds to pay down teacher pension debt and provide teacher pay raises. However, much of the effort to broaden the sales tax base and make temporary tax rates permanent failed, leading to, among other things, a compromise that increased the state sales and use tax to 5% beginning January 1, 2025 through December 31, 2029.

Below is a Session Summary, which contains bills tracked by the PJAL, links to the proferring legislators and bill documents, and a short summary of each piece of legislation.

 2024 Third Extraordinary Session Wrap for the PJAL