Louisiana Budget Project Executive Director Jan Moller issued the following statement about the 2021 Legislative Session:
“Federal pandemic relief dollars lessened the pressure on the state budget and allowed the Legislature to make important new investments in education, including a much-needed boost to the Go Grants program that will make college more affordable for low-income students and the creation of the M.J. Foster Promise Program to provide workforce training for Louisiana adults.
“Legislators also took an important step to helping women and families afford basic necessities by eliminating the sales tax on diapers and feminine hygiene products, passing the Pregnant Worker Fairness Act to encourage businesses to provide better accommodations for workers who are pregnant and extending the sunset date on the Earned Income Tax Credit.
“Unfortunately, our lawmakers also missed an historic opportunity to fix Louisiana’s broken tax structure. The tax swap package that passed in the final hours of the session starts with an excellent premise: eliminating the federal income tax deduction that ties Louisiana’s tax code to the federal government. Legislators could have used the revenue gained by eliminating this deduction to make new investments, or to reduce racial disparities in our tax system by reducing the state sales tax. Instead they used the revenue to cut income-tax rates for individuals and corporations. A “trigger” amendment makes this worse by calling for automatic tax cuts – at the expense of other priorities – if Louisiana’s economy performs better than expected.
“The federal relief dollars that are helping Louisiana avoid budget cuts will soon be gone, and the Legislature will once again struggle to pay for basic services. The Legislature could have taken important steps to avoid this fiscal cliff, but chose not to do so this session. Instead they made their jobs more difficult by cutting taxes and diverting dollars from the state general fund to pay for road construction projects.”