A Tax Raising Affair Began Last Sunday
State lawmakers convened a special session of the Legislature last Sunday, and it’s safe to say no one is going to have any fun. That may be the understatement of the year.
Hanging over their heads is a budget deficit in the current fiscal year and another deficit on the horizon for the new fiscal year, though no one seems to know for sure how large those deficits currently are or will be in a week or two or three or whenever.
Gov. John Bel Edwards and his commissioner of administration, Jay Dardenne, have repeatedly told us the current fiscal year deficit is running in the neighborhood of $750 million. On the other hand, they’ve said the deficit heading into the fiscal year that begins July 1 is hovering around $1.9 billion. We’ve been fed those figures as if they were gospel, or not to be questioned by anyone.
Meanwhile, Edwards recently upped the ante and said the new fiscal year deficit will run greater than $2 billion, and in response to this latest round of good news, he will hand the Legislature a proposed budget for the 2016-2017 fiscal year that includes more than $2 billion in cuts in state spending. No one will like it, according to Edwards.
It’s a typical scare tactic. Sadly, scores of Louisianians will buy it.
To counter, or to stave off drastic cuts in spending, Edwards unveiled a laundry list of tax-raising proposals for lawmakers to entertain during the special session that began last Sunday. It included everything from manipulating the state income tax rates to cutting out deductions tax filers can claim on their state income taxes to an increase in the state sales tax on a host of goods and services to taxing dividend income one might collect on bank stock and on and on, including a tax hike on tobacco and alcohol.
There also was an item or two included in Edwards’ call that deals with cutting spending.
In all, though, there were 36 items on the special session call. No less than 22 of them deal with raising taxes. That number would climb to 28 if the subsections of one tax-raising item were included.
In the coming days, we will hear all about the dooms-day scenarios that are to certain to occur if lawmakers don’t go along with Edwards on the tax-raising front. Higher education officials will play a pivotal role in selling the tax hikes, though it would behoove Edwards and our friends in higher ed to take a poll on the public’s attitude toward pumping more money into the state’s colleges and universities. They may discover there’s not much appetite for it.
All of this talk about the dire straits of the state’s finances prompted yours truly to do some reflecting. I seem to recall a time in the early 1990s during former Gov. Edwin Edwards’ fourth and final term in office. Dardenne was a state senator back then.
Edwards had proposed a rather large tax increase — some $1 billion if I recall correctly. Like today, higher education was on the chopping block.
But the Legislature, with Dardenne serving as one of the ringleaders of the opposition to the tax hikes, balked at Edwards’ wish list and gave the governor a very modest tax increase. Cuts in state spending ensued. Higher ed took a hit.
Guess what? The world didn’t come to an end.
Sam Hanna is a state political writer.