TAX/AD VALOREM-EXEMPTION: Provides relative to an optional exemption of business inventory from ad valorem taxes and a partial exemption for that property based on fair market value adjustments (OR SEE FISC NOTE SD EX)

This bill allows Louisiana parishes to choose between two tax relief options for business inventory: a full exemption over up to seven years with state compensation, or a partial exemption that reduces the percentage of fair market value used to calculate taxes. Parishes that elect the full exemption would receive state payments equal to the greater of taxes collected on business inventory in 2026 or $500,000, capped at $10 million. The partial exemption option requires written agreements between local officials to reduce the tax valuation percentage, which must be submitted to the Louisiana Tax Commission. These changes would apply to property tax years beginning on or after January 1, 2026, affecting businesses that hold inventory subject to ad valorem taxes.