Louisiana Legislature Considers Eliminating State Income Tax

The Louisiana legislature is considering eliminating the state income tax and some local residents have strong opinions about that.  ABC 31 News’ Joel Massey has more from a state lawmaker who is pushing for the change.

The state’s House Ways and Means Committee met today to discuss the possibility of doing as Texas and others have done and eliminating the state income tax.  Here’s what some local residents had to say about that idea.

Finessa Walters said, “I’d be in complete agreement with that.  I believe we are already taxed plenty in every other area.  I’d be all for it.”

Tolbert Wilkins said, “Bad idea.  I think it’s a real bad idea.  For working people like us, if they take away something that means that they are going to have to raise something else up, and why you want to raise something else up when you are not raising nobody pay.  It’s already hard around here to make ends meet because everything is going up around us but the pay.  So if you take the income tax away from us how are we going to survive?”

Judy Wells said, “I think that would be great we are already paying enough taxes.  I think it would free up a lot of money and people would be able to spend money on more things and it might help the economy who knows?”

The committee laid the groundwork today of where they would like to go as far as studying the state tax structure.  The department of revenue and legislative fiscal office gave an introduction on what was presented in the past.  District 89 Representative Richard Nelson proposed the plan.

“My plan is to build a Texas style system where you get rid of the income tax completely.  Really that would look at, you’d have to mirror these other places as far as where they get the revenue from.  Sales tax is one piece.  In Texas actually their sales tax is not as high as ours but they have a broader tax base and I think that’s one thing you really have to look for especially in Louisiana.  We have and entire book of exemptions both to the sales tax, the income tax, the corporate franchise tax, the corporate income tax and then even in the property tax. And so you’d have to look at expanding the base especially the property tax and sales tax so it’s not necessarily raising the rates on everyone that pays now but expanding it so that everybody pays into the system.  And I think that’s really the only way you could get rid of the income tax and be competitive with these other states.”

Nelson says the state’s growth has been stagnant for quite some time.

“I think the last time Louisiana added a congressional seat which reflects the last time our state grew faster than the rest of the country was 1910.  And so it was over a hundred years ago that we were seeing growth that exceeded the rest of the country.  This last census came in and the rest of the country grew about three times as fast as us.  And then our neighbors in Texas and Florida grew six times as fast as we did.  So when you look at what’s the common thread between these other states that are growing much quicker than us it’s really that lack of an income tax.  It’s really something that draws people, it keeps companies there.  It attracts new companies and it keeps the successful people in the state. So I think when you’re looking at the future of where you want Louisiana to go, how do we attract industries and jobs of the future this is probably the most important thing that we can do.”

In the next couple of months the House Ways and Means Committee will have a series of meetings with stakeholders like local governments, tax collectors and assessors, sheriffs and business groups to discuss the best way to move forward about the possible restructuring of state taxes.

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