2024 Louisiana Legislative Sessions Update

Posted December 10, 2024

In 2024, the Louisiana State Legislature convened into an Organization Session and adjourned on Jan. 8. The First Extraordinary (Special) Session began on Jan. 15 and ended on Jan. 19, while the Second Extraordinary Session ran from Feb. 19 until Feb. 29. The legislators went into their regularly scheduled session from March 11 until June 3, but were then called back into special session on Nov. 6 and adjourned on Nov. 22.

It was the Third Extraordinary Session that brought about the most noteworthy pieces of tax reform legislation[1].

Personal Income Taxes Lowered HB 10 lowers personal income taxes from 4.25% to a flat rate of 3%, eliminating Louisiana’s three income tax brackets and totally eliminating taxes for low-income individuals. Coupled with the tax reform from 2020, the Louisiana personal income tax rate has been cut in half from 6% in 2020 to the 3% that begins in 2025!

Pay Raise for Teachers HB 5 provides a permanent $2,000 pay raise for teachers and a $1,000 increase for other employees using savings from debt payments to the Teacher’s Retirement System.

Franchise Tax Eliminated Beginning Jan. 1, 2026, the corporate franchise tax on owning property or conducting business in the state will be fully eliminated. Louisiana was previously only one of 17 states with a corporate franchise tax. The legislature had originally proposed eliminating the franchise tax in 2023; however, the bill was vetoed by the previous governor.

Corporate Tax Rate Reduced Louisiana’s corporate income tax rate was lowered from 7.5%, one of the highest in the nation, to a flat 5%. The legislation also phased out many credits, deductions, and exemptions in an attempt to make Louisiana more attractive to businesses.

Rewrote Portions of the Constitution Act 1 amends certain portions of the budget and tax sections of the constitution, including Article VII, allowing the state legislature to postpone property tax payments during declared emergencies. The rewrite also limits growth in future state spending. This rewrite also allows the state to use large savings fund balances to pay off debt to the Teacher’s Retirement System, and the savings from debt payments will be used to provide the above-mentioned $2,000 pay raise. The constitutional amendment on the ballot in the spring of 2025 must pass for the teachers to receive their permanent pay raise.

Sales Tax Code Modernized HB 9 subjects additional services, such as apps, streaming services, software, digital books, and more, to sales tax. Most of these taxes were historically paid through brick and mortar services. Now that many of these items are available on the internet, the tax revenue was not being collected. This bill addresses those changes in technology.

Sales Tax Rate Set Louisiana sales tax rate was raised from 4.45% to 5.0%, the first time since July 1, 2018. The famous 0.45% sales tax was set to expire in 2025. Instead, the legislature chose to use the sales tax as a means to provide funding to reduce the personal income tax rate to 3%.

Limit on Government Spending HB 13 will limit the growth in reoccurring government expenditures to no more than 3%. Any revenues received in excess of 3% can only be used for non-reoccurring expenses, such as infrastructure projects.

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In 2019, Beau Beaullieu was elected to the Louisiana House of Representatives from District 48. He serves as chair of the House and Governmental Affairs Committee and sits on the Atchafalaya Basin Program Oversight Committee, Joint Legislative Committee on Capital Outlay, and Legislative Budgetary Control Council. Beau is chair of the Acadiana Delegation and serves on the Louisiana Republican Legislative Delegation and Louisiana Rural Caucus. He is eligible to serve through the 2028 term.

[1] Legis.la.gov

Beau Beaullieu

As a veteran of the retirement plan industry and a partner in CoSource Financial Group, LLC, Beau specializes in the implementation, maintenance, and ongoing service of qualified retirement plans. His main role is to create a comprehensive retirement plan program that meets the fiduciary needs of business owners and their executives, as well as to provide ongoing educational services to their employees. For more than 20 years, Beau has worked with plan sponsors to coordinate appropriate retirement plan design and fiduciary governance protocol. He has improved the retirement readiness of thousands of employees by delivering the fundamentals of retirement planning, asset allocation, and the need for increased savings in a proven manner to employers and their plan participants. Beau is the leader of CoSource’s Fiduciary Task Team, which researches legislative trends that affect the fiduciary obligations of plan sponsors.