The last remaining effort to rewrite Louisiana’s broken tax code died a quiet death in a Senate committee on Saturday, with the authors withdrawing their bills rather than face certain defeat. As The Advocate’s Tyler Bridges reports, a package of bills by Reps. Julie Stokes and Barry Ivey would have eliminated the lucrative tax break for federal income taxes paid in exchange for a new, flat income-tax rate on individuals and corporations.
Members of the Senate Revenue & Fiscal Affairs Committee … said they had no other choice after the Louisiana House killed virtually all of the other ideas recommended by the 13-member panel. Making piecemeal changes, the senators said, wouldn’t help the much-lamented tax system. “That massive reform that was supposed to happen this year has not happened,” state Sen. JP Morrell, D-New Orleans and the committee chairman, told his colleagues in comments that three others echoed.
As LBP’s Nick Albares wrote last week, the biggest problem with the Stokes-Ivey bills was that they did nothing to solve the looming $1.3 billion fiscal cliff that occurs next year when temporary taxes expire, and would remove flexibility from the structure of the income tax.
The Nola.com/The Times-Picayune editorial board writes that legislators were wrong to ignore expert advice in favor of anti-tax sentiment that some lawmakers perceive from their districts.
“We do not have the will to solve the problem,” Rep. Ivey said. Rep. Jim Morris, a Republican from Oil City, proceeded to prove him right. “Tax policy to me isn’t as important as what my constituents want, and my constituents told me pretty solidly: ‘Do not vote for more taxes on us.'” But a balanced, fair tax system that provides predictable revenue for state services is better for everyone. That may mean some taxes need to be higher and others are lower. Legislators ought to understand that.
Budget negotiations highlight final days
The full Senate passed its version of the 2017-18 state budget in quick fashion on Saturday, setting up negotiations with House leaders on a compromise as lawmakers face a mandatory Thursday adjournment. The AP’s Melinda Deslatte reports that disagreements will likely center on whether the state should spend all available revenue, or leave some reserves in case of a mid-year shortfall.
“The idea of using 100 percent of funds, in my view, is a bad idea because history has proven it’s feel-good legislation. At the end of the day, you still have to cut,” said Rep. Blake Miguez, a Republican from Erath. Alexandria Rep. Lance Harris, chairman of the House GOP delegation, agreed: “I do believe it’s going to bring on midyear cuts as it has for every year since 2009.” Senators said leaving money on the table would cause damaging and unnecessary cuts now. They sought to protect college campuses that have been repeatedly hit with slashing, the child welfare agency and state prisons. “This is what we would call an austere budget,” said Senate Finance Chairman Eric LaFleur, a Ville Platte Democrat who said the Senate budget proposal only funds “what is necessary.”
Cassidy plays ‘hard to get’
Louisiana’s senior U.S. Senator, Bill Cassidy, is in line to be one of the pivotal votes in Congress’ effort to cut taxes for the wealthy while stripping health coverage from more than 20 million Americans, mostly low- to moderate-income people. The first-term lawmaker, and former Charity system physician, has authored his own plan with Sen. Susan Collins that is more centrist than the House’s American Health Care Act (AHCA), but which would still allow state the option to gut Medicaid and stop federal support for tax credits that make health coverage more affordable. The Advocate’s Stephanie Grace:
He wouldn’t say whether he’d definitely vote no on the House bill, arguing instead that there’s no way it will come before him without major changes. “That said, I think I’ve been pretty clear that I want something different,” he added. The real question, of course, is just how different it has to be, and which parts of the House bill would cause him to vote no. This much is clear by now, though: Like Landrieu before him, Cassidy obviously understands that there’s power in playing hard to get.
An emerging progressive agenda
Republicans are having trouble moving their legislative agenda through Congress in large part because they spent much of the previous eight years opposing Barack Obama’s agenda instead of developing plans of their own. So says economist Jared Bernstein, who writes in The New York Times that progressives are hoping to avoid that same fate by coalescing around a set of ideas to help working families that include a higher minimum wage, expansion of income supports through the Earned Income Tax Credit, and this:
A child allowance of $250 a month per child would cost about $190 billion a year, though half of those costs could be offset by consolidating existing, less-efficient policies. It would cut child poverty by 40 percent and deep child poverty by half, while providing middle-income families raising children with a baseline level of stable income.
Number of the Day
24.5 – Percentage of Louisiana children who sometimes go hungry, according to a new report by Save the Children that ranks the Pelican State dead last overall for children’s well being. (Source: Save the Children via Nola.com/The Times-Picayune)