Imposes an excise tax on proceeds from geologic storage of carbon dioxide (OR INCREASE GF RV See Note)
Summary
HB 646 creates a new chapter in Title 47 of the Louisiana Revised Statutes establishing a 30% excise tax on proceeds derived from the geologic storage of carbon dioxide in Louisiana. The tax applies to each storage operator’s gross proceeds from geologic storage at any site in the state and is imposed in addition to all other state and local taxes that may already apply to the operator’s sales and income.
The bill defines key terms by reference to the existing Louisiana Geologic Sequestration of Carbon Dioxide Act, including “carbon dioxide,” “geologic storage,” and “storage operator.” It also assigns administration and enforcement to the Department of Revenue, authorizes the department to promulgate rules, and requires quarterly reporting and payment. The tax would apply to taxable periods beginning on or after July 1, 2025, with the act itself becoming effective on that date.
Impact
HB 646 would add a new excise tax provision to Louisiana’s tax code and directly affect businesses serving as carbon dioxide storage operators. It would create a new revenue stream for the state by taxing gross proceeds from carbon sequestration activities, while also layering on top of existing state and local tax obligations. The bill would require the Department of Revenue to administer, collect, and enforce the tax and to issue implementing regulations, thereby expanding state oversight of geologic carbon storage operations under Title 47.
Sentiment
Based on the bill text and the limited available context, the measure appears to be framed as a revenue-raising proposal rather than a broadly bipartisan policy initiative. No committee transcript or vote history is available here, so there is no recorded public debate to indicate support or opposition. The caption note suggesting it may increase general fund revenue implies the bill is intended to generate state revenue from an emerging industrial activity, which may appeal to fiscal supporters but raise concerns among affected industry stakeholders.
Contention
The main point of contention is likely the size and structure of the tax: a 30% excise tax on gross proceeds is substantial and could be viewed by carbon capture and storage operators as a deterrent to investment or project development. Opponents may argue that taxing geologic storage could undermine carbon capture efforts or make Louisiana less competitive for low-carbon industrial projects, while supporters may view the tax as a way to ensure the state shares in the value of storage operations. Any debate would likely center on the balance between revenue generation, environmental policy, and economic development.