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ragincajun03
LA-Lafayette Fan
Energy Capital of the World, TX
Member since Nov 2007
14343 posts

Louisiana Tax Swap Plans Win Final Passage to Reach Ballot
quote:

BATON ROUGE, La. (AP) — A long-recommended proposal to untie Louisiana's income tax collections from federal tax payments won passage Thursday from lawmakers on the legislative session's last day, sending the concept to voters for a decision on the October ballot.

The proposal would get rid of personal income tax and corporate tax deductions for federal income taxes paid in exchange for lowering the state’s income tax rates. Louisiana also would permanently eliminate the corporate franchise tax for small businesses and lower the tax rate for others.

Franklin Republican Sen. Bret Allain, who led the Senate tax debate, hailed passage as a critical “tax reform."

Gov. John Bel Edwards could scuttle the tax swap if he vetoes individual pieces of a package that requires all measures to pass before it can take effect. But if he rejects some parts, voters could still adopt part of the plan that lowers the top personal income tax rate, blowing a hefty hole in the budget without the remaining pieces of the tax package.

That possibility could box the Democratic governor into supporting the other bills. Republican legislative leaders said they've been working with Edwards on the proposals, and the governor has broadly supported the tax swap concept for years. He hasn't announced a public position on the specific package of bills that passed, however.



quote:

The right-leaning Pelican Institute for Public Policy praised the tax package as starting “the process of simplifying our overly complex and burdensome tax code that has sent jobs and opportunity to other states and hurt Louisiana’s families for far too long.”

The left-leaning Louisiana Budget Project raised concerns. Jan Moller, head of the organization, objected that the tax changes would benefit business and higher-income taxpayers more than low- to moderate-income taxpayers. He also criticized triggers in the bills that could lower corporate franchise and personal income tax rates in later years if Louisiana sees certain revenue growth.


“It puts tax cuts at the front of the line," Moller said. "I think it’s bad policy for 2021 legislators to make this decision for future legislators who may have different priorities,” Moller said.

In exchange for losing the tax break for federal taxes paid, taxpayers would receive a 1.85% personal income tax rate on the first $12,500 of net income, down from 2%. The tax rate for the next $37,500 of income would fall from 4% to 3.5%, and the rate for income above $50,000 would drop from 6% to 4.25%.

The constitutional change would cap the maximum allowable rate of personal income tax in Louisiana at 4.75%, so lawmakers could never increase the rate above that percentage unless returning to voters.

On the corporate side, the proposal would scrap current rates that range from 4% to 8% and companies would lose the ability to deduct federal taxes paid from their state taxes. In exchange, the state would charge companies a 3.5% tax rate on the first $50,000 of earnings; 5.5% on earnings above $50,000 and up to $150,000; and 7.5% on earnings above $150,000.


Republican legislative leaders said they expect to largely raise the same amount of revenue for the state treasury. But a nonpartisan financial analysis of the bills suggests the state could lose some money in the early years of the changes.


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ragincajun03
LA-Lafayette Fan
Energy Capital of the World, TX
Member since Nov 2007
14343 posts

re: Louisiana Tax Swap Plans Win Final Passage to Reach Ballot
Just as an FYI, it appears not all conservative-leaning voices in Louisiana are for this mostly Republican-backed swap.

Right now, Moon Griffon has Pelican Institute CEO Daniel Erspamer on his radio show right now, and Moon appears to be against the tax reform/swap/simplification.


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udtiger
US Space Force Fan
Louisiana
Member since Nov 2006
76569 posts
 Online 

re: Louisiana Tax Swap Plans Win Final Passage to Reach Ballot
This sounds remarkably dumb.


CarRamrod
USA Fan
Spurbury, VT
Member since Dec 2006
53389 posts

re: Louisiana Tax Swap Plans Win Final Passage to Reach Ballot
quote:

"I think it’s bad policy for 2021 legislators to make this decision for future legislators who may have different priorities,
what a count.


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40
scottfruget
Wofford Fan
Member since Nov 2010
2869 posts
 Online 

re: Louisiana Tax Swap Plans Win Final Passage to Reach Ballot
Read something about the state contract with accesshealth yesterday and how the state lost money. Some liberal rep said we should not renew things that lose money. Imagine the hypocrisy. I am willing to bet every social program funded by the gov is full of waste and graft and loses money. But those are all good.

So it does not surprise me that the left leaning org is against lower taxes that may lead to less money for the gov.


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20
LSUKTR
LSU Fan
Baton Rouge
Member since Nov 2005
1462 posts

re: Louisiana Tax Swap Plans Win Final Passage to Reach Ballot
I need to go check my avg rate for the past few years.


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