La. R.S. 47:1703.3 — Business inventory; partial exemption; percentage of fair market value adjustment

NOTE: §1703.3 eff. upon ratification of the const. amend. proposed by Acts 2025, No. 221.
A.(1)(a) In accordance with the Constitution of Louisiana for purposes of ad valorem
taxation, a parish may elect to partially exempt business inventory by reducing the
percentage of fair market value applicable to property considered business inventory
established in the constitution.
(b) The election by a parish to reduce the percentage of fair market value applicable
to business inventory pursuant to the provisions of this Section shall be irrevocable and once
the percentage of fair market value has been reduced in a parish, the percentage of fair
market value shall not be increased. A parish shall not reduce the percentage of fair market
value of business inventory more than once an assessment period.
(2) The partial exemption of business inventory shall apply only in parishes in which
the sheriff, school board, and the parish governing authority elect to reduce the percentage
of fair market value applicable to business inventory. However, the percentage of fair
market value applicable to business inventory shall never be higher than the percentage
applicable to business inventory pursuant to Article VII, Section 18(B) of the Constitution
of Louisiana.
(3) The partial exemption reducing the percentage of fair market value applicable
to business inventory shall be evidenced in writing and shall be submitted to the Louisiana
Tax Commission and the appropriate tax assessor within ten calendar days of the execution
of the agreement between the sheriff, school board, and the parish governing authority to
reduce the percentage of fair market value applicable to business inventory. The written
documentation shall contain the new percentage of fair market value applicable to business
inventory in the parish and shall indicate the effective date of the reduced percentage. The
Louisiana Tax Commission shall include all written notifications received from parishes
indicating a reduction of the percentage of the fair market value applicable to business
inventory in the commission's annual reports.
B. Any decrease in the total amount of ad valorem tax collected by a taxing authority
as a result of the reduction of the percentage of fair market value applicable to business
inventory authorized in this Section shall be absorbed by the taxing authority and no
additional tax liability for taxpayers in the taxing district shall be created as a result of any
subsequent reappraisal and valuation or millage adjustment. Implementation of the
reduction of the percentage of fair market value applicable to business inventory authorized
in this Section shall neither trigger nor be cause for a reappraisal of property or an
adjustment of millages pursuant to Article VII, Section 23 of the Constitution of Louisiana.
C. For purposes of this Section, the term "business inventory" shall mean the
aggregate of those items of tangible personal property as defined in R.S. 47:301(16)(a) that
are held for sale in the ordinary course of business, are currently in the process of
production for subsequent sale, or are to physically become a part of the production of such
goods.