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Started By
Message
The Louisiana Industrial Tax Exemption Program (ITEP) is all that is wrong with our state
Posted on 8/18/23 at 10:14 am
Posted on 8/18/23 at 10:14 am
Property taxes aren't even that high compared to other states.
Property taxes ARE collected by state and local governments. The state does not collect any state level property taxes.
Yet, until a few years ago, a state agency got to decide if industrial taxpayers got an exemption from taxes... THAT THEY DID NOT COLLECT. And there are many people that want to go back to that system. Insane!
It would be like if the IRS said, hey John Taxpayer, you know, you pay a lot in federal income tax, so you no longer have to pay state sales tax.
Get rid of the income tax. Get rid of ITEP. Texas does this, and they have no issues getting new industrial construction.
Property taxes ARE collected by state and local governments. The state does not collect any state level property taxes.
Yet, until a few years ago, a state agency got to decide if industrial taxpayers got an exemption from taxes... THAT THEY DID NOT COLLECT. And there are many people that want to go back to that system. Insane!
It would be like if the IRS said, hey John Taxpayer, you know, you pay a lot in federal income tax, so you no longer have to pay state sales tax.
Get rid of the income tax. Get rid of ITEP. Texas does this, and they have no issues getting new industrial construction.
5
Posted on 8/18/23 at 10:27 am to LSUFanHouston
Agreed. It’s one thing to give incentives to industries and businesses to move here, but it’s another when they get to take advantage of it, use our rich O&G resources, and put very little back into the communities and states they reside in. We’re basically like Africa.
Posted on 8/18/23 at 11:18 am to LSUFanHouston
Wasn’t there a YouTube video going around by some group that analyzed how much money just BR would be getting from Exxon if ITEP were eliminated? It was something like $70 million.
I’ll have to go search for it.
I’ll have to go search for it.
Posted on 8/18/23 at 11:19 am to LSUFanHouston
ITEP and the homestead exemption should be eliminated while holding total dollars collected in property tax still for one year allowing the rates to dramatically decline.
End the franchise tax.
Then end the income tax
End the franchise tax.
Then end the income tax
Posted on 8/18/23 at 11:25 am to sta4ever
quote:
and put very little back into the communities and states they reside in
While I'm going to agree that there does need to be more scrutiny in ITEP and that there should be at least some local government input, that's a pretty broad negative statement above.
Just talking about the Petrochemical industry that does benefit from and take advantage of the ITEP program, there are quite a few who participate in and dump a ton of money and volunteerism into the local communities where they operate.
Posted on 8/18/23 at 11:27 am to LSUFanHouston
Sorry, but I immediately dismiss anyone that talks about ITEP without mentioning the Homestead exemption.
Our ITEP was slightly more generous than the rest of the south. Mostly even now, but for a lot of state don't exclude taxes to school districts.
OTOH-we have the highest homestead in the country. In the 90s, something like 70% of homeowners paid ZERO property tax.
This isn't even getting into the 50% markup businesses get on their assessment. Or that they pay tax on movable goods like inventory, but citizens don't.
The system is so skewed against business that whining about ITEP comes across as ignorant and populist. It smacks of coming up with excuses why others should pay your taxes.
Our ITEP was slightly more generous than the rest of the south. Mostly even now, but for a lot of state don't exclude taxes to school districts.
OTOH-we have the highest homestead in the country. In the 90s, something like 70% of homeowners paid ZERO property tax.
This isn't even getting into the 50% markup businesses get on their assessment. Or that they pay tax on movable goods like inventory, but citizens don't.
The system is so skewed against business that whining about ITEP comes across as ignorant and populist. It smacks of coming up with excuses why others should pay your taxes.
Posted on 8/18/23 at 11:28 am to BigJim
quote:
we have the highest homestead in the country. In the 90s, something like 70% of homeowners paid ZERO property tax.
This isn't even getting into the 50% markup businesses get on their assessment. Or that they pay tax on movable goods like inventory, but citizens don't.
The system is so skewed against business that whining about ITEP comes across as ignorant and populist. It smacks of coming up with excuses why others should pay your taxes.
Have an upvote, sir.
Posted on 8/18/23 at 12:34 pm to BigJim
quote:
Sorry, but I immediately dismiss anyone that talks about ITEP without mentioning the Homestead exemption.
So do you support ITEP?
Or, are you simply saying that reform here should be tied to reform on the homestead exemption?
You will get no argument from me that the homestead exemption needs to be dealt with.
Because it's the same thing by a different stripe. Again, it's the state government limiting local governments ability to collect a tax, that the state itself does not collect.
Posted on 8/18/23 at 12:59 pm to LSUFanHouston
Pretty good thread from yesterday on the OT that got into a lot of this debate if you are interested.
LINK
LINK
Posted on 8/18/23 at 1:06 pm to LSUFanHouston
I have long advocated that every property owner pays something in the way of property tax to support local governments.
Pick a number say $50,000.00 and have everyone pay their share of the first 50K. It could be 25K, 40K or whatever. Don’t get hung up on the number, follow the principle. Everyone should have skin in the game.
After the first 50K you are exempt 75K or whatever. Once you exceed 125 K or whatever you start paying again.
Pick a number say $50,000.00 and have everyone pay their share of the first 50K. It could be 25K, 40K or whatever. Don’t get hung up on the number, follow the principle. Everyone should have skin in the game.
After the first 50K you are exempt 75K or whatever. Once you exceed 125 K or whatever you start paying again.
Posted on 8/18/23 at 1:16 pm to doubleb
What you're proposing makes a ton a sense, and is actually what other states do.
Because let's face it, if you pay zero property tax, then why should you be voting in millage increases and such?
Because let's face it, if you pay zero property tax, then why should you be voting in millage increases and such?
Posted on 8/18/23 at 1:19 pm to ragincajun03
quote:
Because let's face it, if you pay zero property tax, then why should you be voting in millage increases and such?
Everyone should have skin in the game.
Renters need to know how much of their rent goes to pay the owner’s taxes.
We need to make sure people that vote on taxes know how it impacts them,
Posted on 8/18/23 at 1:23 pm to LSUFanHouston
quote:
So do you support ITEP?
Yes, but in the sense that's a band-aid thrown on top of a terrible tax structure to make La somewhat competitive. Fix the underlying problems and I am fine with eliminating it.
quote:The different assessment ratios for homeowners vs businesses (not to mention utilities) is a more fundamental problem. But yeah, asking industrial and manufacturing businesses to give up their major incentive without anyone else giving up anything is just indicative of our "tax the man behind the tree" attitude.
Or, are you simply saying that reform here should be tied to reform on the homestead exemption?
quote:
Because it's the same thing by a different stripe. Again, it's the state government limiting local governments' ability to collect a tax, that the state itself does not collect.
Of course, that's true for every single property tax exemption. You only notice the ITEP because each exemption gets a review.
I have some general ideas, but I out in another post.
Posted on 8/18/23 at 1:30 pm to BigJim
quote:
Of course, that's true for every single property tax exemption. You only notice the ITEP because each exemption gets a review.
About 10 years ago, I decided to vote against every single proeprty tax exemption I see on a ballot.
I don't care who it supports or how "well-intentioned" it is. I vote no every single time.
Becuase they are all terrible and make a bad problem even worse.
Posted on 8/18/23 at 1:30 pm to doubleb
quote:
I have long advocated that every property owner pays something in the way of property tax to support local governments.
Pick a number say $50,000.00 and have everyone pay their share of the first 50K. It could be 25K, 40K or whatever. Don’t get hung up on the number, follow the principle. Everyone should have skin in the game.
After the first 50K you are exempt 75K or whatever. Once you exceed 125 K or whatever you start paying again.
A good idea and similar to Florida.
Other ideas-Exempt school revenue from both ITEP AND Homestead exemption.
Locals can have control of ITEP but only the parish governing body. Having to jump through multiple hoops = more patronage. The sheriff should get a say, why?
Remember, school boards are already exempt. Locals should also demonstrate clear criteria and the capacity (staffing, expertise, etc) to judge. If that's done, then it doesn't even have to come back to the Board of Commerce and industry in my book.
And of course, you could either eliminate ITEP and Homestead completely (IB's idea) or cut it down substantially ($25k homestead, 5 year no renewal ITEP) and just lower rates. Never going to happen though.
Posted on 8/18/23 at 1:31 pm to doubleb
quote:
I have long advocated that every property owner pays something in the way of property tax to support local governments.
Pick a number say $50,000.00 and have everyone pay their share of the first 50K. It could be 25K, 40K or whatever. Don’t get hung up on the number, follow the principle. Everyone should have skin in the game.
After the first 50K you are exempt 75K or whatever. Once you exceed 125 K or whatever you start paying again.
Yes, or another flavor of that is a parcel fee.
Every piece of land is subject to an annual fee.
I've long advocated that taxes that cover basic government utility, such as fire, police, and drainage, should be handled this way.
Posted on 8/18/23 at 1:36 pm to BigJim
quote:
The system is so skewed against business that whining about ITEP comes across as ignorant and populist. It smacks of coming up with excuses why others should pay your taxes.
I don’t know man. I live in a 1700 sq ft home in New Orleans and I paid over $4000 in property taxes this year. Doesn’t feel like I’m freeloading.
Posted on 8/18/23 at 1:38 pm to LSUFanHouston
quote:
Yes, or another flavor of that is a parcel fee.
Every piece of land is subject to an annual fee.
I've long advocated that taxes that cover basic government utility, such as fire, police, and drainage, should be handled this way.
We have them in La, but I think they are only used by neighborhoods. The problem is some parcels are larger than others. In a single neighborhood, that isn't a problem. Parish, or city wide, that could become out of whack quickly.
Posted on 8/18/23 at 1:58 pm to Jimbeaux
quote:
I don’t know man. I live in a 1700 sq ft home in New Orleans and I paid over $4000 in property taxes this year. Doesn’t feel like I’m freeloading.
So is your home worth about $375k? I used the citywide NO rate of 134 mills to back into that, so I might be off a bit.
So let's use that. Your (hypothetical) market value is $375k. The assessed value is 10% of market value for a home. So $37.5k. Subtract the $7500 homestead for $30k.
Apply the 134 mills (.134) = $4020
Wow, that's a lot!
Now let's do a business with the same market value.
$375k market value
The business has to use an assessment value of 15% of market value (instead of the 10% you get) = $56,250
Now let's take off their homestead...nope. How about ITEP...nope unless they are manufacturing something there. So no exemptions means the value stays at $56,250.
Apply the 134 mills = $7537 in annual taxes for the business.
Now, I am not saying you aren't paying a lot. But a business with same market value pays almost double.
This post was edited on 8/18/23 at 2:00 pm
Posted on 8/18/23 at 2:05 pm to BigJim
quote:
We have them in La, but I think they are only used by neighborhoods. The problem is some parcels are larger than others. In a single neighborhood, that isn't a problem. Parish, or city wide, that could become out of whack quickly.
Can it be tied to acreage or sq ft of land or something like that?
My point is, something like drainage cost isn't necessairly varied by the value of the land or improvements, but can be by size of land or the type of improvements.
This post was edited on 8/18/23 at 2:07 pm
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