La. lawmakers revisit ditching state income tax

Louisiana’s state income tax policy has been debated for a number of years.
Published: Sep. 13, 2022 at 5:21 AM CDT|Updated: Oct. 12, 2022 at 4:43 AM CDT
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BATON ROUGE, La. (WAFB) - Louisiana’s state income tax policy has been debated for a number of years. And as much as some would like to see it tossed away, it won’t be that easy.

“You can’t just wave a magic wand and say, ‘I’m gonna get rid of the income tax,’” said Rep. Richard Nelson (R) of Mandeville.

As a big proponent of getting rid of the tax, Rep. Nelson said it’s going to require a lot of moving parts.

“You really have to look at it comprehensively and say, what do we look at with every single tax, property taxes, sales taxes, mineral taxes, everything? And then you have to look at, too, a breakdown of state and local spending,” Rep. Nelson continued.

Putting heads together with the Department of Revenue and the Louisiana Fiscal Office, the House Ways and Means committee saw Louisiana spends way more money on the state level than it does on the local level. The goal is to figure out a way to put more of that state money back into local governments for them to have more control over where the money goes. Some on the committee, believe the policy is what gives states like Texas and Florida an advantage.

“It is true that comparing Louisiana’s top tax rate, Louisiana is higher than neighboring states,” said Secretary Kevin Richard with the Dept. of Revenue.

Louisiana also has one of the highest sales tax rates in the country. However, with the sales tax rate on top of the income tax, Louisiana’s economy still falls short of states that have seen more jobs and population growth.

According to Richard, Louisiana is in the top two of the country when it comes to state sales taxes. He adds that we are up there with Tennessee. However, Tennessee does not have a state income tax.

To find a better solution that can gain enough support from the legislature, a sub-committee was created to look at the policy more in-depth. The hope is to come up with legislation that can be presented in the next session. The sub-committee will try and meet in the next couple of weeks.

Lawmakers are scheduled to meet on Wednesday, Oct. 12 to discuss the issue.

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