2023 Louisiana Laws › Revised Statutes › Title 47 - Revenue and Taxation › §47:1967. Listing and assessment of bank stock; procedure

RS 47:1967 - Listing and assessment of bank stock; procedure
A. The shares of stock of all banks, banking companies, firms, associations, or corporations, doing a banking business in this state, chartered by the laws of this state, any other state, or of the United States or chartered under the laws of another country are hereby declared subject to taxation for all purposes in this state.
B. Shares of stock of all banks, banking companies, firms, associations, or corporations doing a banking business in this state, chartered by the laws of this state, any other state, or of the United States, or chartered under the laws of another country shall be valued by the assessing authorities for taxation for all purposes at a percent of their valuation made by the assessing authorities in accordance with law, as follows: shares of stock in federal joint stock land banks organized under the Farm Loan Act of 1916 of the United States Congress shall be assessed for the purpose of taxation at fifteen percent of their valuation made by the assessing authorities in accordance with law, and shares of all state-chartered banks and of all national banks shall be assessed for the purpose of taxation at fifteen percent of their valuation commencing with taxable year 1978 made by assessing authorities in accordance with law, calculated and ascertained by the method hereinafter set forth.
C. The basis for arriving at the valuation of the shares of stock in any bank, banking company, firm, association, or corporation engaged in the banking business shall be the stockholder equity capital which shall be determined by the addition of paid-in common stock, surplus, undivided profits, and all reserves, excluding those reserves for loan losses as allowed by the United States Internal Revenue Service. Equity capital shall be adjusted to remove that portion of equity capital based on United States obligations by deducting a percentage of equity capital based on the ratio of United States obligations to total assets. Borrowed money and the value of the preferred stock issued by any such bank and actually owned by the United States of America or any agency thereof shall not be construed as equity capital for the purposes of this Section.
D. For the purposes in determining the fair market value of bank stock, the following criteria shall be used: stockholder equity as defined in Subsection C of this Section shall serve as a four times factor, eighty percent; annual net earnings of the individual banking institution shall serve as a one time factor, twenty percent. Annual net earnings shall be adjusted to remove that portion of earnings based on United States obligations by deducting a percentage of annual net earnings based on the ratio of interest on United States obligations to total operating income. Negative earnings shall be included in this formula, but there shall be no earnings loss carried forward or backward. For the purpose of computing the one time, twenty percent earnings factor, the earnings shall be capitalized by multiplying the annual net earnings or net loss of the banking institution by the average price earnings ratio for all banks in the United States as published by a nationwide recognized bond and securities rating firm.
E. For the purposes of arriving at fair market value of bank stock in the formula outlined in Subsection D, the tax commission or its successor shall compute the formula as follows:
(1) In the case of banks, banking companies, firms, associations, or corporations created under the laws of the United States, from the statements made to the comptroller of the currency and required to be published as of December thirty-first of each year.
(2) In the case of banks, banking companies, firms, associations, or corporations created under the laws of this state, from the statement made to the commissioner of financial institutions, and required to be published as of December thirty-first of each year.
(3) In the case of banks, banking companies, firms, associations, or corporations created under the laws of any other state, the FDIC or state regulator and required to be published as of December thirty-first of each year.
(4) In the case of banks created under the laws of another country, information is to be submitted to the Louisiana Tax Commission which shall satisfy the purposes of this Chapter.
F. From the assessment determined by the application of the fifteen percent of fair market value provided for above, there shall be deducted fifty percent of the assessed value of real estate, improvements, buildings, furniture and fixtures owned by the bank. If such real estate, improvements, buildings, furniture and fixtures are owned by a separate corporation, the deduction will be allowed provided all the capital stock of which (except directors' qualifying shares, if any) is owned by the bank, banking company, firm, association or corporation.
G. Except as provided herein, no assessment shall hereafter be made against the capital stock, surplus, undivided profits or reserves of any bank, banking company, firm, association, or corporation engaged in the banking business, chartered under the laws of this state, any other state, or of the United States, or chartered under the laws of another country doing business in this state, whose capital stock is represented by shares.
H.(1) It is the will of the Louisiana Legislature to ensure that Louisiana banks do not become the only corporations in the state subject to a corporate tax. Currently, the corporate tax paid by banks is the tax on bank stock provided for in this Section, which is paid in lieu of payment of state corporate income taxes pursuant to R.S. 47:287.11 et seq. Therefore, if state corporate income tax for corporations other than banks under R.S. 47:287.11 et seq. is repealed or reduced, the Louisiana Legislature shall provide a commensurate level of tax relief to banks paying tax under the provisions of this Section, while identifying a revenue source to meet the obligations of local governments to provide necessary services.
(2) Any action taken by the Louisiana Legislature to comply with the provisions of this Subsection shall not result in banks being subject to any new tax, fee, or charge that is not applicable to other corporations in the state.
(3) For purposes of this Subsection, "banks" or a "bank" means an institution insured by the Federal Deposit Insurance Corporation that is subject to taxation under this Section.
Amended by Acts 1966, No. 145, §1; Acts 1976, No. 704, §1, eff. Jan. 1, 1978; Acts 1984, No. 107, §1; H.C.R. No. 88, 1993 R.S., eff. May 30, 1993; H.C.R. No. 1, 1994 R.S., eff. May 11, 1994; Acts 2004, No. 396, §1; Acts 2014, No. 135, §1; Acts 2014, No. 623, §1.