§245.  Determination of Louisiana apportionment percent

A.  Air transportation.  The Louisiana apportionment per cent of any taxpayer whose net apportionable income is derived primarily from the business of transportation by aircraft shall be the arithmetical average of two ratios, as follows:

(1)  The ratio of the value of immovable and corporeal movable property, other than aircraft, owned by the taxpayer, and located in Louisiana, to the value of all immovable and corporeal movable property, other than aircraft, owned by the taxpayer and used in the production of apportionable income; and

(2)  The ratio of the amount of gross apportionable income derived from Louisiana sources to the total gross apportionable income of the taxpayer.

For the purposes of this Subsection, gross apportionable income from Louisiana sources shall include all gross receipts derived from passenger journeys and cargo shipments originating in Louisiana, and any other items of gross apportionable income or receipts derived entirely from sources in this state.

B.  Pipeline transportation.  The Louisiana apportionment per cent of any taxpayer whose net apportionable income is derived primarily from the business of transportation by pipeline shall be computed by means of the ratios provided in Subsection F of this Section.

C.  Other transportation.  The Louisiana apportionment per cent of any taxpayer whose net apportionable income is derived primarily from the business of transportation, other than by aircraft or pipeline, shall be the arithmetical average of two ratios, as follows:

(1)  The ratio of the value of immovable and corporeal movable property, owned by the taxpayer and located in Louisiana, to the value of all immovable and corporeal movable property owned by the taxpayer and used in the production of apportionable income; and

(2)  The ratio of the amount of gross apportionable income from Louisiana sources to the total amount of gross apportionable income of the taxpayer.

For the purposes of this Subsection, the gross apportionable income from Louisiana sources shall include all such income that is derived entirely from sources within this state, and a portion of revenue from transportation partly without and partly within this state, to be prorated subject to rules and regulations of the Collector, which shall give due consideration to the proportion of service performed in Louisiana.

For the purposes of this Subsection, the value of immovable and corporeal movable property owned by the taxpayer and used in Louisiana shall include the value of all such property regularly situated in this state, plus a pro rata of the value of all rolling stock and other mobile equipment owned by the taxpayer and used in the production of apportionable income, whether within or without this state, said proration to be made subject to rules and regulations of the Collector, which shall give due consideration to the mileage operated and traffic density within and without this state.

D.  Service enterprises.  The Louisiana apportionment per cent of any taxpayer whose net apportionable income is derived primarily from a service business in which the use of property is not a substantial income-producing factor, shall be the arithmetical average of two ratios, as follows:

(1)  The ratio of the amount paid by the taxpayer for salaries, wages, and other compensation for personal services rendered in Louisiana, to the total amount paid by the taxpayer for salaries, wages, and other compensation for personal services in connection with the production of the net apportionable income; and

(2)  The ratio of the gross apportionable income of the taxpayer from Louisiana sources to the total gross apportionable income of the taxpayer.

For the purposes of this Subsection, the gross apportionable income from Louisiana sources shall include the revenue from services performed in this state, and any other gross income derived entirely from sources within this state.

E.  Loan business.  The Louisiana apportionment per cent of any taxpayer whose net apportionable income is derived primarily from the business of making loans shall be the arithmetical average of two ratios, as follows:

(1)  The ratio of the amount paid by the taxpayer for salaries, wages, and other compensations for personal services rendered in Louisiana, to the total salaries and wages paid by the taxpayer in connection with the production of the net apportionable income; and

(2)  The ratio of the amount of loans made by the taxpayer in this state to the total amount of loans made by the taxpayer.

F.(1)  Manufacturing, merchandising, and other business.  Except as provided in this Subsection, the Louisiana apportionment percent of any taxpayer whose net apportionable income is derived primarily from the business of transportation by pipeline or from any business not included in Subsections A through E of this Section shall be the arithmetical average of three ratios, as follows:

(a)  The ratio of the value of the immovable and corporeal movable property owned by the taxpayer and located in Louisiana, to the value of all immovable and corporeal movable property owned by the taxpayer and used in the production of the net apportionable income.

(b)  The ratio of the amount paid by the taxpayer for salaries, wages, and other compensation for personal services rendered in this state, to the total amount paid by the taxpayer for salaries, wages, and other compensation for personal services in connection with the production of net apportionable income.

(c)  The ratio of net sales made in the regular course of business and other gross apportionable income attributable to this state to the total net sales made in the regular course of business and other gross apportionable income of the taxpayer.

(2)  For the purpose of this Subsection, the Louisiana apportionment percent of any taxpayer whose net apportionable income is derived primarily from the business of manufacturing or merchandising shall be computed by means of the ratios provided in Subparagraphs (1)(a) through (c) of this Subsection, except that the ratio of net sales as provided in Subparagraph (c) shall be double-weighted or counted twice, and the Louisiana apportionment percent shall be the arithmetical average of the four ratios.  The term "business of manufacturing or merchandising" shall only include a taxpayer whose net apportionable income is derived primarily from the manufacture, production, or sale of tangible personal property.  The term "business of manufacturing or merchandising" shall not include:

(a)  A taxpayer subject to the tax imposed pursuant to Chapter 8 of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950.

(b)  Any taxpayer whose income is primarily derived from the production or sale of unrefined oil and gas.

(3)  For the purpose of this Subsection sales attributable to this state shall be all sales where the goods, merchandise, or property is received in this state by the purchaser.  In the case of delivery of goods by common carrier or by other means of transportation, including transportation by the purchaser, the place at which the goods are ultimately received after all transportation has been completed shall be considered as the place at which the goods are received by the purchaser.  However, direct delivery into this state by the taxpayer to a person or firm designated by a purchaser from within or without the state shall constitute delivery to the purchaser in this state.  

(4)  For the purpose of this Subsection, salaries, wages, and other compensation for personal services paid by a taxpayer whose principal office is located in Louisiana, to officers and employees responsible for the direction and supervision of operations of the taxpayer partly within and partly without Louisiana, and salaries, wages, and other compensation for personal services paid to general office employees whose duties pertain to the operations of the taxpayer partly within and partly without Louisiana, shall be allocated in part to this state on the basis of the ratio of the amount of direct operating salaries, wages, and other compensation for services rendered in Louisiana to the total of such direct operating salaries, wages, and other compensation paid in connection with the production of net apportionable income.

(5)  For the purpose of this Subsection gross apportionable income attributable to this state derived from the transportation of crude petroleum, natural gas, petroleum products, or other commodities for others through pipelines shall include all gross revenue derived from operations entirely within this state plus a portion of any revenue from operations partly within and partly without this state, based upon the ratio of the number of units of transportation service performed in Louisiana in connection with such revenue to the total of such units.  A unit of transportation service shall be the transporting of any designated quantity of crude petroleum, natural gas, petroleum products, or other commodities for any designated distance.  All other classes of gross apportionable income shall be prorated within or without this state on the basis of such ratio or ratios, prescribed by the collector, as may be reasonably applicable to the type of business involved.

G.  Value.  For the purposes of this Section the value at which immovable and corporeal movable property should be included in the apportionment factor is the average of the beginning and close of year values on a comparable basis within and without the state.  If the average at the beginning and end of the year does not fairly represent the average of the property owned during the year, the average may be obtained by dividing the sum of the monthly balances by twelve.  For purposes of this Section the value of property is deemed to be cost to the taxpayer less a reasonable reserve for depreciation, depletion and obsolescence.  Such reserves, reflected on the books of the taxpayer, shall be used in determining value, subject to the right of the collector to adjust the reserves when in his opinion such action is necessary to reflect the fair value of the property.

H.  Location.  For purposes of this Section, corporeal movable property located in Louisiana in United States customs-bonded warehouses or foreign trade zones established under the Foreign Trade Zones Act shall be considered located outside Louisiana.

Amended by Acts 1954, No. 494, §1; Acts 1958, No. 170, §3; Acts 1960, No. 566, §1; Acts 1988, No. 841, §1, eff. July 18, 1988; Acts 1996, No. 19, §1, eff. for taxable years beginning on or after Jan. 1, 1997.