If you’re planning to sell some railroad ties for use in another state, you’re in luck, at least if you live in Louisiana: You won’t have to pay sales tax on the transaction.

And if you’re a commercial fisherman using undyed diesel fuel, take heart. You’re exempt from Louisiana’s inspection fee.

Renting a room at a homeless shelter or a nonprofit retreat? You don’t have to pay sales tax. Same goes for pallets bought by certain manufacturers. And — partly, at least — for printing machinery purchased by newspapers.

And so on, and so forth.

Louisiana’s tax code is a huge Swiss cheese, shot through with exemptions large and small, sublime and ridiculous, important and petty. There are 462 altogether, all of them listed in a compendium called the Tax Exemption Budget assembled every year by the state Department of Revenue. The document runs 400 pages.

To Stephen Moret, who as the secretary of Louisiana Economic Development spends a fair bit of his time fretting over the state’s business climate, the leaky, complicated tax code is a major obstacle to attracting new investment. The tax laws manage to combine Byzantine complexity with generally high rates, meaning that Louisiana from afar looks like a high-tax state even as it provides plenty of loopholes for those in the know to wriggle through.

In short, it’s the worst of both worlds.

“Louisiana has a very peculiar tax structure,” Moret said. “We are one of the lowest-tax states in America in terms of what most businesses and families actually pay in taxes — not the tax rates, but the actual taxes they pay. And yet we appear to be a higher-than-average tax state on the surface because we have every major tax type, and the tax rates that the state levies generally are average to above-average. The reason there’s a disconnect … is that we have more tax exemptions than almost any other state.”

Moret pointed to an April study by the left-leaning Progressive Policy Institute that put Louisiana in the top 10 states in a “tax complexity index” because of its huge number of exemptions. Only Washington state has more breaks on the books, the group said.

“I think having far less exemptions and lower, flatter tax rates generating the same amount of revenue would be a better system and a more stable system than what we have now,” Moret said.

Much of the problem results from the way the Legislature tends to confront problems, working around them rather than through them, according to Robert Travis Scott, president of the nonpartisan Public Affairs Research Council.

“In defense of business, quite often it’s a bad tax policy that leads to another bad tax policy,” rather than a business seeking a sweetheart deal, Scott said. “Often, what ends up happening is that some really bad tax policy happened, and then the businesses went and said, ‘This places our company or industry in a noncompetitive situation and it needs to be fixed.’ So then they created another bad tax policy to fix it. And you just have this great dysfunctional system that has built up over time.”

Were it to pare back the list of exemptions, Moret said, Louisiana might fare better on business-climate surveys and also be able to trim its overall tax rates. A year and a half ago, Gov. Bobby Jindal proposed some cuts along those lines, but his plan collapsed under the weight of its main plank: eliminating the individual income tax.

Scott said Jindal’s tax overhaul actually had good ideas in it, but they were overshadowed by the unworkability of its central concept.

“The governor was so fixated on this one unobtainable goal that he bypassed opportunities for real reform. … And we ended up with one spectacular failure rather than a few minor victories,” Scott said.

It’s important to note that Louisiana’s many and varied exemptions aren’t all created equal — far from it. The big problem isn’t so much the number of exemptions, though that may be worth addressing.

Most of the lost revenue is contained in a relatively small number of the 462 breaks on the books.

In fact, just 12 of them account for roughly two-thirds of the $7.1 billion in revenue that the Department of Revenue estimates is lost to such giveaways each year. And many of them are breaks it would make little sense to get rid of, such as the exemption on sales taxes for items purchased by local government.

Meanwhile, most of the exemptions are as meaningless fiscally as they are exotic — for instance, specific exemptions carved out for charities like the Society of the Little Sisters of the Poor, the St. Bernard Project and Ducks Unlimited. Probably half the breaks could be nullified without any real impact on tax collections.

But while it might be easy to junk some of the narrower and cheaper breaks, deep-sixing exemptions that are saving certain taxpayers lots of money would cause those taxpayers heartache. As a result, those are always “heavily lobbied,” Moret said, and the status quo is often the result.

That’s too bad, Scott said.

“What people don’t see in this is that you could reduce rates for everybody if these exemptions were tamed or brought down or eliminated,” he said. “Then the rates overall could be more broad-based, and could be lower. There would be a lot to be gained from it.”

Three Louisiana university professors — Jim Richardson, of LSU, and Jim Alm and Steve Sheffrin, of Tulane — are leading a study of the state’s tax structure with funding provided by the Legislature. Their report is due in March and will make recommendations about how to improve the system.

“I think at the end of the day we might talk about best practices in what we would call an ideal system,” Richardson said. “But we also appreciate that any tax system is a political document. It has to be acceptable to the people. We as experts can talk all we want about what should or should not be, and I hope we can persuade our leaders to look at this and persuade the people that we really need to have a good tax system. But at the end of the day, the people count.”

More on this story: Giving Away Louisiana, Part 1 sidebar: Tax credits spawn cottage industry of consultants

Follow Gordon Russell on Twitter, @gordonrussell1.