La. Senate approves penny sales tax increase, sunset clause changed to 5 years

La. Senate approves penny sales tax increase, sunset clause changed to 5 years

BATON ROUGE, LA (WAFB) - The Senate approved a one cent sales tax increase previously passed by the House. However, senators amended the bill to change the sunset clause from 18 months to five years. That means the approved tax increase will have to return to the House for final approval before heading to the Governor's desk.

The sales tax increase means a penny will be added to the existing four cent sales tax.

Meanwhile, many of the other bills to increase taxes were pushed back again, including the ones on cigarettes and alcohol.

"Bare with us as we allow our authors to work through their bills and amendments accordingly," said House Speaker Taylor Barras, (R) New Iberia.

Lawmakers say the delays are because they are still lobbying to get enough votes.

Statement by Gov. Edwards on the Special Session

Today, Gov. John Bel Edwards released the following statement on the progress of the special session to correct the largest budget deficit in Louisiana's history.  This evening, the Louisiana Senate voted to pass a new penny sales tax measure that would be combined with the $160 million in spending cuts proposed by the governor and the use of additional funds and revenue-raising measures to close the budget gap.  Gov. Edwards is calling for the additional penny sales tax to be removed after a new, more stable way of taxing personal and corporate income is put in place by the legislature and Louisiana voters.

"I want to thank the members of the legislature who are working with me to solve this historic problem," said Gov. Edwards. "The suggestion that we should sit back and let this problem continue into the next year is reckless and jeopardizes Louisiana's already weakened credit rating. After eight years of irresponsible budgeting that repeatedly pushed problems down the road instead of solving them, the people of Louisiana expect us to end that kind of behavior. We have eight days to agree on the solutions to solve this crisis. I will continue to work with both parties in the legislature to come to an agreement that will stabilize our state budget this year and going forward."

Gov. Edwards issued a broad call, or agenda, for the special session that allowed the legislature to make additional spending cuts further than he has proposed, reduce contracts, and eliminate certain statutory dedications.  On Jan. 19, Gov. Edwards outlined a comprehensive proposal to solve the budget deficit. However, to date, no comprehensive alternative has been proposed by the members of the legislature fully correcting the budget deficit for this year or next.

Last week, the House of Representatives voted on a measure to make more than $100 million in cuts through H.B. 122.  Even with these proposed cuts, coupled with the revenue raising measures already approved, the legislature still has not secured enough funds to fill the current year's $940 million shortfall.

Furthermore, it was suggested this week by one House leader to the Senate Finance Committee that, rather than solve the problem before us, we should push a deficit into next year, adding to an already $2 billion deficit next year.  That suggestion has since been widely criticized by Republicans and Democrats in both the House of Representatives and Senate.

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