Tax breaks for companies that kill jobs

Tax breaks for companies that kill jobs

Gov. Jeff Landry is nixing a requirement that companies must create new jobs if they receive lucrative property tax exemptions through the state’s Industrial Tax Exemption Program. In 2016, former Gov. John Bel Edwards signed an executive order that included the job creation component for ITEP, arguably the most generous property tax exemption program in the nation. The Times Picayune | Baton Rouge Advocate’s Blake Paterson reports

“If a company is going to spend $100 million on a robot that’s going to replace 50 workers, that’s their right in our economy, but they sure as hell shouldn’t get a tax break as a thank you,” said Jan Moller, executive director of the left-leaning Louisiana Budget Project who also served on the state board that evaluated ITEP applications under Edwards. Edgar Cage, a leader with Together Louisiana, a faith-based nonprofit that took up the fight to change ITEP, said the jobs requirement “leveled the playing field,” giving local governments something in return for giving up the tax revenue. 

The Times Picayune | Baton Rouge Advocate’s 2017 investigation explained how companies have received hundreds of millions of dollars in property tax exemptions while decreasing the number of employees. 


Blocking health care research in an unhealthy state 
Gov. Jeff Landry’s support for the proposed sale of Blue Cross and Blue Shield of Louisiana to a private insurance conglomerate comes with a peculiar twist: Language added to the deal at Landry’s request specifies that the charitable foundation that will be spawned by the deal can support medical research at Pennington Biomedical Research Institute in Baton Rouge – but cannot grant money to other Louisiana colleges and universities. The Times Picayune | Baton Rouge Advocate’s Stephanie Riegel reports

Landry said that giving the money to other Louisiana research institutions, a list that would include LSU and Tulane University, would be wasteful. …  The remarks shed new light on why Blue Cross officials made revisions to their plans for Accelerate Louisiana as they seek approval later this month from state insurance regulators and Blue Cross policyholders.

Doctors, including Louisiana’s largest physician group, hospitals, state lawmakers and the Louisiana Budget Project have raised questions about the deal, and its effect on consumers.

Jan Moller of the Louisiana Budget Project has been critical of the foundation’s decision to give appointment power of a seat on the foundation board to the governor. “Our concerns about the foundation have always been that it not become a political entity that serves the ideology of the governor,” Moller said. “It shouldn’t be looking to take Medicaid coverage away from people.”

Earlier this week state lawmakers questioned Blue Cross representatives about Elevance’s shoddy track record in other states and how the sale would affect the health care landscape in Louisiana.

The company has racked up more than $26 million in regulatory fines for violations that included denying coverage of needed medical care, failing to cover preventive service like immunizations and breast cancer screening, and failing to pay claims in a timely manner. Louisiana, where Elevance administers the Healthy Blue Medicaid plan, was among the seven states where the company has incurred fines.


Small investments can pay big dividends
A minor (by federal standards) investment in the Internal Revenue Service can yield a major return in tax revenue by allowing the agency to better pursue wealthy tax cheats. That’s according to a new report from the U.S. Treasury Department. The IRS received an $80 billion boost from the Inflation Reduction Act, but GOP lawmakers have already clawed back $20 billion of that.  The Washington Post’s Julie Zauzmer Weil reports: 

The government could get even bigger bang for its buck than it had promised in earlier research — by some measures, at least five to seven dollars in additional tax collected for every dollar spent, concluded the study, released Tuesday. The Treasury Department said the IRS could convert the $80 billion it was allocated under the 2022 Inflation Reduction Act into at least $561 billion in extra taxes collected over the next decade. If that amount is cut $20 billion, however, it cost more than $100 billion in potential revenue, the report claimed.

Consumers, meanwhile, could save plenty of money during tax filing season under a new pilot program that lets people file tax returns for free through a new government portal. As Johnny Harris and Binyamin Appelbaum explain in a New York Times video, lobbyists for private tax-filing companies, led by TurboTax parent Intuit, are working overtime to kill the plan. 


Making the most of federal investments
Louisiana is poised to reap billions of federal dollars in the next few years through various infrastructure laws signed by President Joe Biden. This money will support physical, digital, water and clean energy infrastructure, and will create new jobs throughout the state. But many of these jobs won’t offer the kind of pay and benefits needed to support a family. The Center for American Progress is out with a new report that lays out job quality standards that states can adopt to make sure workers reap the benefits of these critical investments:  

These policies will have the greatest effect when adopted in tandem and expanded to all types of government spending. For example, while wage and benefit standards can help ensure that government spending does not undercut area market wages, project labor agreements and targeted hire standards can help raise standards even higher and target local residents as beneficiaries of spending, thereby supporting project stability and ensuring a pipeline of well-qualified workers. 


Number of the Day
9.56% – The combined state and average local sales tax rate for Louisiana, which is the highest in the nation. (Source: Tax Foundation