CABL was pleased to serve on the Task Force on Structural Change in Budget and Tax Policy. From our perspective, the group’s final recommendations represent a strong step forward for Louisiana in suggesting a permanent tax structure to replace the temporary actions approved by the Legislature in the 2016 legislative sessions.
It was our goal on the task force to be as fair as we could to all taxpayers. At the same time, we were seeking to design a tax structure that provides sustainable funding for the necessary services of state government, while enhancing our economic competitiveness with other states. We believe this plan does that.
It is critical that all who review the task force recommendations do so in a holistic way. For the most part, no one piece of the major tax structure recommendations can stand alone. They are integrated parts of an entire plan that lowers sales taxes, decreases rates on individual income taxes, makes significant changes in some major tax credit and exemption programs, and seeks to mitigate or phase out some business taxes that hurt our competitiveness.
Any group can look at any individual piece of the plan and point out areas of concern. That’s to be expected. But we would caution against doing that without weighing the many offsets that are envisioned as part of the entire plan. We were asked to take a comprehensive approach to our tax structure and any review of the plan should be comprehensive, as well.
Are the recommendations in the report perfect? It is likely that no member of the task force would say that they are. But that’s probably a good thing because it is an indication that the task force was grappling with some extremely difficult issues and yet still found a way to address them. Hopefully, that bodes well for the future.
Finally, it should be pointed out that these are recommendations not legislation. The Legislature can make adjustments if it chooses to raise a tax here or lower a tax there. But it would be a mistake to say this plan is simply about raising or lowering taxes. It’s about establishing a new fiscal framework that works better than what we have now for the state, its citizens and its businesses.
That includes making needed changes in some of our spending practices. There are a number of recommendations about ways to improve our fiscal discipline so that we truly live within our means today while avoiding new problems for tomorrow. They are part of the big-picture solution, too.
The temporary nature of the revenue increases made over the last two years will force lawmakers to revisit those issues and take some kind of action no matter what. From CABL’s perspective it should be bold action that addresses our budget issues in a sustainable way, but also treats taxpayers fairly and makes Louisiana more competitive. We believe the recommendations made by the task force offer a road map for accomplishing that.