House panel puts another dent in governor's tax reform plan, kills other reform measures

BATON ROUGE, LA (WAFB) - The Republican-controlled House committee in charge of taxes has put a massive dent in the governor's proposal to overhaul the state's tax system.

The House Ways and Means committee killed a series of governor-backed bills Tuesday that would have modified the state's individual and corporate income taxes.

The governor's office said his plan, which was based on proposals from a tax reform task force, would have lowered taxes for about 90 percent of personal income filers across the state. In other words, households making about $140,000 or less would see their taxes reduced.

Those making more could have seen the amount they pay increase.

"Some tax payers will pay a little bit more, a lot will pay a little bit less," said Jim Richardson, an economist and member of the task force.

The bills, sponsored by Rep. Rob Shadoin, R-Ruston, eliminated certain individual and corporate income tax deductions. In exchange, both individual and corporate income tax rates would be reduced.

Most Republicans on the panel balked at the idea, fearful it would increase the burden on business.

"If this is just a policy shift, it doesn't look like it's such a good policy shift for business," said Rep. Barry Ivey, R-Central.

The bill's failure comes just a few weeks after the same committee put the brakes on another key part of the governor's plan – the so-called "Commercial Activity Tax" on business.

After the plan's failure Tuesday, Gov. John Bel Edwards released a statement saying he was "disappointed" in the committee's decision to kill the bills.

"The hard working people of Louisiana don't have high-priced lobbyists in the legislature; that's our job, but it appears that some members of this committee have forgotten that," Edwards continued.

The committee also killed a bill that would have overhauled the business tax system. Sponsored by Rep. Kenny Havard, R-Jackson, it would have replaced two older business taxes currently on the books with a new flat tax.

Havard said the bill was about making sure that all businesses pay a little something, including those that rely on deductions and exemptions to avoid the income tax. However, facing pressure from business lobbyists and the conservative group Americans for Prosperity, the committee punted the proposal.

"Looks like we're going to kick the can down the road," Havard said.

After two days of votes, the committee advanced only one major comprehensive tax reform plan to the House floor. Crafted by Ivey, the fate of that plan going forward remains a mystery.

Reflecting after his bills failed in committee, Shadoin told reporters that Louisiana can "kiss reform goodbye" for this session. Last year, lawmakers repeatedly put pointed to the 2017 legislative session as an ideal time to do tax reform.

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