Louisiana House Bill HB366

Louisiana 2025 Regular Session

• Introduced: 4/3/25
• Refer: 4/3/25
• Refer: 4/14/25
• Refer: 4/15/25
• Refer: 4/16/25
• Engrossed: 5/7/25
• Refer: 5/8/25
• Report Pass: 5/19/25
• Enrolled: 6/12/25
• Chaptered: 6/13/25
• Passed: 6/13/25

Caption

(Constitutional Amendment) Authorizes parishes to exempt business inventory from ad valorem taxes and authorizes parishes to reduce the percentage of fair market value applicable to business inventory (EN SEE FISC NOTE GF EX See Note)

Summary

HB 366 is a proposed constitutional amendment that would give parishes new flexibility to reduce or eliminate ad valorem taxes on business inventory. It adds a new constitutional provision allowing an optional parish-level exemption for business inventory, and it also permits a parish to choose a partial exemption by lowering the assessed percentage of fair market value for that property. The exemption would only take effect if the parish sheriff, school board, and parish governing authority all agree, making it a local, multi-entity decision rather than a statewide mandate. The bill also creates a funding mechanism tied to the state’s Revenue Stabilization Trust Fund. If a parish irrevocably exempts all business inventory from ad valorem taxation, the state would make a one-time payment to that parish, with the money distributed to local taxing authorities. In addition, the measure prohibits the legislature from passing a law that would require taxing authorities to exempt business inventory, preserving local discretion and preventing a statewide compulsory exemption. The amendment would apply to tax years beginning on or after January 1, 2026, and would be submitted to voters at the statewide election on April 18, 2026.

Impact

If approved, HB 366 would amend Louisiana’s constitution to change how business inventory is treated for property tax purposes and to add a new parish-level exemption option. It would affect Article VII provisions governing ad valorem taxes, property classification, and exemptions, while also authorizing one-time state payments from the Revenue Stabilization Trust Fund to parishes that fully exempt business inventory. The measure would directly affect parish governments, sheriffs, school boards, tax collectors, and businesses that hold inventory subject to property tax, and it could reduce local tax bases in participating parishes.

Sentiment

The voting record shows strong bipartisan support and no recorded opposition in either chamber. The House and Senate both passed the measure unanimously at the relevant stages, and the House later rejected Senate amendments and adopted the conference report with similarly lopsided support. The lack of dissent suggests broad agreement on giving parishes more flexibility to manage business inventory taxation and on pairing any local exemption with state transition funding.

Contention

There is little evidence of overt controversy in the available record, but the main policy tension is between local tax relief and the potential impact on parish and school revenues. Supporters appear to favor local control and a mechanism to offset lost revenue through a one-time state payment, while the structure requiring agreement from the sheriff, school board, and parish governing authority reflects concern about protecting local taxing entities. Another point of interest is the constitutional prohibition on the legislature mandating an inventory exemption, which limits future state intervention and preserves parish discretion.