La. House kills another tax bill, leaving few options to fill state's shortfall

Another of Governor Edwards’ revenue proposals shot down

BATON ROUGE, LA (WAFB) - The La. House killed another of the governor's tax proposals Sunday night, leaving few revenue options on the table for filling the state's
projected shortfall.

HB 38 would have generated about $88 million next year, getting the state closer to the $600 million the governor said is needed to fund critical priorities like TOPS and the partnership hospitals that treat the uninsured. Last week, a top state economist estimated that the state could also be facing a $200 million deficit due to lower-than-expected corporate tax returns.

"We have to turn this ship around, and we have to fund the vital services that are also important to all of us, and all of our constituents whether you're poor, middle class or wealthy," said Rep. Malinda White, D-Bogalusa, who sponsored the legislation.

The bill's demise was swift. No lawmakers spoke out in opposition before the House voted 46-55, killing the measure.

As amended, the bill would have modified what people can claim among their itemized deductions on the personal income tax. While charitable donations, medical expenses, and home mortgages could still be claimed, the state income tax as well as the state and local sales tax could not.

The bill would have impacted the upper quarter of tax payers, or those making at least $100,000 per year.

"That population of people, many of which are the job creators, the small business owners, and those deductions are important to them," said Rep. Mike Johnson, R-Bossier City, who voted against the bill. "We didn't think it was good policy at this time - maybe the worst possible time - to take that away from them."

So far, the House has advanced bills that would bring in close to $220 million next year.

Meanwhile, only two other Edwards-backed revenue measures remain alive at the capitol. The bills, which modify corporate tax breaks, appear in House committee Monday morning, having already successfully advanced through the Senate.

Both are estimated to bring in less than first anticipated. Combined, SB 6 and SB 10 would generate around $81 million next year. That means that, as it stands, the most the House could pass this session is around $300 million worth of revenue bills, or about half of what the governor said is needed.

Richard Carbo, a spokesman for the governor, released the following statement after Sunday's vote to kill HB 38:

"Gov. Edwards has offered a comprehensive plan to fully fund the Louisiana's critical priorities. With every vote against additional revenue, these members who refuse to compromise are voting to cut TOPS, K-12 education, higher education, and lifesaving health care services. At the same time, they have not offered a single plan of their own to fund these programs. Gov. Edwards is not taking anything for gr anted, and he is still meeting with legislators to find the best path forward on a plan to stabilize our budget and put Louisiana on a path to prosperity."

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