NOTE: §1703.3 eff. upon ratification of the const. amend. proposed by Acts 2025, No. 221.

§1703.3. Business inventory; partial exemption; percentage of fair market value adjustment

            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.

            Acts 2025, No. 357, §1, eff. See Act.