A new year brings a feeling of hope and renewal. However, for all its good qualities, our state badly needs to get its fiscal house in order. After repeated budget shortfalls, budget cuts, temporary tax increases, and a host of other patchwork legislation, it is time to take this head on. The current system has failed us all and we desperately need bold action.
The legislatively created Task Force on Structural Change in Budget and Tax Policy spent months crafting a comprehensive package for restructuring our tax code to move to a system that is “fair, easy to comply with and competitive with other states” intended to stabilize our base and grow long term. The HCR11 report outlines specific recommendations on the budget and changes to the structure of sales tax, personal income tax, corporate income tax, and property tax.
The policy direction makes sense: rebalance our revenue streams, lower the personal and corporate tax rates while broadening the base, better align local and state sales taxes, modernize tax collection and aUditing, remove impediments like the inventory and franchise taxes, clean up tax exemptions, toughen business incentives, and empower local governments. There is much to offer in this sweeping plan.
For its part, the Committee of 100 is trying to be a change agent, conducting listening sessions around the state with community leaders to highlight the Task Force proposals, building on its earlier tax work through the well-respected Tax Foundation. Much of the 2014 Tax Foundation findings and recommendations are consistent with the HCR11 Task Force proposals. The ideas are on the table … now the advocacy work begins.
Over the next few months, the administration and lawmakers will need to air it out in hopes that a consensus legislative package can come together in time for the legislative session that begins April 10. That is a built-in deadline to negotiate and align. If that fails, we will be right back to the fiscal chaos facing annual budget deficits approaching $2 billion a year.
We are urging policymakers to embrace real tax reform this year, to bring us hope of a better financial future with a tax system that will meet our state obligations, put our universities on track, attract business, allow for investment in transportation, improve our national rankings, and remain competitive for job growth.
This should be our collective New Year’s resolution—resolve to improve Louisiana’s fiscal state!
B. Wayne Brown
Louisiana Committee of 100