Sales-tax renewal brings much-needed stability
BATON ROUGE – The Legislature’s agreement on a revenue deal is excellent news for college students and faculty members, prosecutors, and the nearly 900,000 low-income Louisiana residents who rely on the Supplemental Nutrition Assistance Program (SNAP) to make ends meet each month. It’s also good news for any Louisiana resident who relies on hospitals, nursing home care or other vital services provided through the Medicaid program.
Those priorities are now assured of funding for another year after being threatened at various times this spring as the Legislature debated whether to renew part of the expiring “clean penny” of sales tax. The compromise solution contained in House Bill 10, which renews 45 percent of the expiring sales tax, will reduce the tax rate of every Louisiana resident while also providing much-needed revenue stability until 2025.
While this agreement is very welcome, it is no substitute for the long-term structural tax reforms that are still needed to put Louisiana on a path of economic growth and prosperity for all of its residents. Louisiana remains far too reliant on the sales tax, which asks too much of those who can least afford to pay, and new investments are badly needed in education, infrastructure, mental health and other priorities.
We wish state policymakers the best as they enjoy a well-deserved break from the Capitol, and we hope that they return in 2019 ready to continue working toward a more fair, adequate, competitive and sustainable tax and budget system.