This excerpt taken from the ADES 10-Q filed Nov 7, 2008.
a.i. - ix.(b).
x. R.S. 47:301(13)(k) excludes machinery and equipment used predominantly and directly in the process of manufacturing tangible personal property for sale or used directly in the production, processing, and storing of food, fiber, or timber for sale from the sales price. For purposes of sales price, the interpretations provided under LAC 61:I.4301.C.Cost Price.h will apply. This exclusion applies to state sales tax and local sales taxes if the political subdivision has adopted this exclusion by ordinance. To determine sales price subject to tax, this exclusion is deducted from the total amount charged to the customer after allowances for trade-ins and before any exemptions provided elsewhere in the law.
b.i. - ii.
-AUTHORITY NOTE:- Promulgated in Accordance with:-R,S. 47:301 and R. S. 47:1511.
HISTORICAL NOTE: Promulgated by the Department of Revenue and Taxation, Sales Tax Section, LR 13:107 (February 1987), amended by the Department of Revenue and Taxation, Sales Tax Division, LR 21:957 (September 1995), LR 22:855 (September 1996), amended by the Department of Revenue, Policy Services Division, LR 27:1703 (October 2001),R 28:348 (February 2002),LR 28:1488 (June 2002), LR 28:2554 (December 2002), LR 28:2556 (December 2002), LR 29:186 (February 2003), LR 30:1306 (June 2004), LR 31:
Family Impact Statement
As required by Act 1183 of the 1999 Regular Session of the Louisiana Legislature the following Family Impact Statement is submitted to be published with the Notice of Intent in the Louisiana Register. A copy of this statement will also be provided to our legislative oversight committees.
1. The Effect on the Stability of the Family. Implementation of these proposed amendments will have no effect on the stability of the family.
2. The Effect on the Authority and Rights of Parents Regarding the Education and Supervision of Their Children. Implementation of these proposed amendments will have no effect on the authority and rights of parents regarding the education and supervision of their children.
3. The Effect on the Functioning of the Family. Implementation of these proposed amendments will have no effect on the functioning of the family.
4. The Effect on Family Earnings and Family Budget. Implementation of these proposed amendments will have no effect on family earnings and family budget.
5. The Effect on the Behavior and Personal Responsibility of Children. Implementation of these proposed amendments will have no effect on the behavior and personal responsibility of children.
6. The Ability of the Family or a Local Government to Perform the Function as Contained in the Proposed Rule. Implementation of these proposed amendments will have no effect on the ability of the family or a local government to perform this function.
Interested persons may submit data, views, or arguments, in writing to Raymond E. Tangney, Senior Policy Consultant, Policy Services Division, P.O. Box 44098, Baton Rouge, LA 70804-4098 or by fax to (225) 219-2759. All comments must be submitted by 4:30 p.m., Tuesday, January 25, 2005. A public hearing will be held on Wednesday, January 26, 2005, at 1:30 p.m. at the Department of Revenue Headquarters Building, 617 North Third Street, Baton Rouge, LA.
Raymond E. Tangney
Senior Policy Consultant
FISCAL AND ECONOMIC IMPACT STATEMENT FOR ADMINISTRATIVE RULES
RULE TITLE: Sales and Use Tax Exclusion for Manufacturing Machinery and Equipment
I. ESTIMATED IMPLEMENTATION COSTS (SAVINGS) TO STATE OR LOCAL GOVERNMENT UNITS (Summary)
Implementation costs to administer the sales tax exclusion for manufacturing machinery and equipment enacted by Acts 2004 1st Ex. Sess., No. 1, for the Department of Revenue are approximately $190,000 for fiscal year 2004-2005, $198,000 for fiscal year 2005-2006, and $206,000 for fiscal year 2006-2007. The costs are to hire two Revenue Accounts Auditors and three Revenue Agents and to purchase the office equipment needed to administer the exclusion. These proposed amendments to LAC 61:I.4301 will not affect those costs. Implementation will have no impact on local governments costs or savings because no local government has adopted this exclusion.
II. ESTIMATED EFFECT ON REVENUE COLLECTIONS OF STATE OR LOCAL GOVERNMENTAL UNITS (Summary)
The phase-in of the sales tax exclusion for manufacturing machinery and equipment enacted by Acts 2004 1st Ex. Sess., No. 1, would reduce state sales tax revenues by $5 million for fiscal year 2004-2005; $20 million for fiscal year 2005-2006; $40 million for fiscal year 2007-2008; $76 million for fiscal year 2008-2009; $96 million for fiscal year 2009-2010; $121 million for
fiscal year 2010-2011; and $125 million annually when fully implemented in fiscal year 2011-2012. The Act allows local governments to adopt the exclusion by ordinance, and since no local government has adopted the exclusion, there will be no effect on local sales tax revenues.
III. ESTIMATED COSTS AND/OR ECONOMIC BENEFITS TO DIRECTLY AFFECTED PERSONS OR NONGOVERNMENTAL GROUPS (Summary) These proposed amendments establish procedures for applying for the manufacturing machinery and equipment exclusion enacted by Acts 2004 1st Ex. Sess., No. 1, and provide guidance to taxpayers on what transactions qualify for the exclusion. It is estimated that the exclusion provided by the Act will save Louisiana manufacturers over $120 million per year in state sales taxes when fully implemented in fiscal year 2011-12.
IV. ESTIMATED EFFECT ON COMPETITION AND EMPLOYMENT (Summary) These proposed amendments should have no effect on competition or employment.