The head of Louisiana’s House Republican caucus on Monday began a push to roll back the part of the state sales tax that lawmakers implemented in a deal to shore up the state’s budget last year.
But Gov. John Bel Edwards, whose administration spoke out against the measure, has taken a stance against tax break proposals, saying they threaten the state’s newfound fiscal stability.
While the governor left himself open to supporting some smaller tax breaks being pushed by lawmakers, he said Friday during a press conference he won’t sign any “high-dollar” tax expenditure proposals.
“Here we finally achieved some level of stability and the Legislature introduces a slew of new exemptions and so forth,” Edwards told reporters. “For the most part these are things we should not be considering at this point in time.”
The efforts include exempting diapers and feminine hygiene products from the sales tax--a measure pushed by state Sen. JP Morrell, D-New Orleans--as well as the roll-back of the 0.45% sales tax hike. Edwards left himself “a little flexibility” in what he might support.
But Revenue Secretary Kimberly Robinson, speaking on behalf of the governor’s office, made clear the administration opposes the effort to cut into the sales tax, which state Rep. Lance Harris, the head of the House GOP caucus, introduced Monday.
On arguments that the legislation would pick apart last year’s hard-fought deal to stabilize the state’s revenue collections, a Louisiana Sena…
The Legislature agreed to the higher sales tax last year after seven special sessions dedicated to ending years’ worth of fiscal crises.
Harris' bill would begin shrinking the 0.45% sales tax hike in the 2020-2021 fiscal year, repealing it by 2023. The measure moved without objection out of the House Ways and Means Committee after several Republican members characterized the state’s recent budget surpluses as proof the state is overtaxing its people. It goes to the full House next.
“We might be extracting too much money out of the taxpayer’s pocket because we’re continually ending up with surpluses and we continually raised taxes and fees over the past two years,” said Harris, R-Alexandria.
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The bill would cost about $392 million in state revenue by 2023, according to legislative estimates.
Lawmakers agreed to add the 0.45% sales tax just before an additional temporary penny was set to expire on July 1, 2018. The figure represented a compromise between the Democratic governor and House Republicans, and is set to last for the next six years. It is set to expire in 2025.
“This was a hard-fought compromise,” Robinson said. “We should protect the general fund now that we’ve finally got it stable.”
Lawmakers have amended several bills this session to avoid having an impact on the upcoming budget cycle, as the Legislature and governor try to pay for things like a teacher pay raise and full funding for popular scholarship programs like TOPS.
Baton Rouge Republican Rep. Paula Davis looked at her colleagues collecting their belongings at the end of the day and noted that while last w…
But many bills would alter the state’s tax base--and flow of revenue--beyond that if passed.
A Senate panel earlier this session killed a measure to divert the 0.45% sales tax proceeds to road projects. Morrell's bid to end the sales taxes on diapers and feminine hygiene products is still alive after a maneuver on the Senate floor. Other measures would re-institute sales tax holidays that were recently repealed in an effort to plug the state’s budget gaps.
The Senate Revenue and Fiscal Affairs on Monday also unanimously backed proposals by state Rep. Jim Morris, an Oil City Republican and oil and gas proprietor, to cut taxes levied on certain oil and gas wells that don’t produce much. Combined, the two bills would cost the state about $12 million a year, according to estimates from legislative staff.
“It’s a hope that this is going to pay for itself, and it’s a $7 million price tag,” state Sen. Jay Luneau, D-Alexandria, said of one of those proposals, before the committee approved the bill without objection. “That’s a tough one to overcome.”