State tax hikes set to raise energy costs in 2025

As many states use the tax code to pick winners and losers, Louisiana has adopted technology-neutral full expensing. Also called immediate expensing, this allows firms to deduct capital costs and research and development expenses in the year they occurred rather than over a lengthy depreciation period. Full expensing reduces the cost of doing business and encourages investments in energy research in development. With a state economy heavily dependent on the oil and gas sector, lowering capital expenses and accelerating innovation will lower energy costs for Louisianans.

While public attention may be focused on federal tax reform and expiring aspects of the Tax Cuts and Jobs Act, state governments are already implementing policies that, in many cases, will increase energy costs. Reducing the reach of state and federal governments and adopting pro-growth reforms, as Louisiana has, will lower prices and leave Americans better off.