Gov. Bobby Jindal’s push to eliminate state income taxes died Monday as legislators embarked on the second week of the session.
With legislators lined up to start the process of pushing tax revamp bills to the governor’s desk, Louisiana House Ways and Means Committee Chairman Joel Robideaux made a surprise announcement.
Robideaux, R-Lafayette, thanked the governor for opening up the tax revamp debate. Robideaux then suggested an end to the conversation.
He said the state revenue concerns were too great.
“Unless the members come to me ... because they’ve had a change of heart, then I think we’re done for the session,” said Robideaux, who as chairman of the House Ways and Means sets the agenda for the tax writing legislative panel.
Ways and Means was slated to start hearing a variety of bills aimed at phasing out the state income tax, repealing it or lowering tax rates. Instead, Robideaux read a statement advocating the committee indefinitely defer consideration of the bills.
House Speaker Chuck Kleckley, R-Lake Charles, backed Robideaux later in the day, saying it would be irresponsible to move a bill eliminating income tax without replacing the revenue that would be lost to state government.
Jindal still was pushing the repeal late last week after abandoning his own tax package.
In a prepared statement, Jindal continued to defend the idea of eliminating state income taxes. “Eliminating income taxes is the single best thing we can do to create jobs in Louisiana. If the Legislature decides not to act, I think it will be a missed opportunity,” the governor said in the news release.
Jindal initially pushed his own tax package. He wanted to eliminate the state’s personal income and corporate taxes in exchange for increasing the state sales tax rate and taxing currently untaxed services, including many business-to-business transactions. The package faltered amid heavy concerns about the impact on businesses and the poor.
The governor yanked his plan last week on the first day of the session and asked legislators to send him their own bill for getting rid of the state’s income taxes. He did not ask them to replace the billions of dollars in revenue that would be lost.
At the same time, legislators are grappling with a state budget that is short by $1.3 billion of the money needed to keep state government services at their current levels in the fiscal year that starts July 1. The governor wants to sell state property and use money from legal settlements to help fund the state’s colleges and universities.
State Rep. Eddie Lambert, R-Prairieville, said state government cannot continue to cobble together its budget every year.
He said the budget situation killed any chance of a tax revamp. “The bills weren’t coming out of committee,” Lambert said.
Robideaux said he talked to Kleckley throughout the weekend before deciding at 11 p.m. Sunday that he would not “prolong the agony.”
Legislators came to the committee meeting prepared to present their bills.
In the audience was Together Louisiana and the United Faith Community of Louisiana, which represents hundreds of religious congregations and civic organizations across the state.
The coalition opposed the governor’s original tax plan as an unfair burden on the low and middle classes.
After Jindal abandoned that plan, the coalition continued to raise concerns, this time about the impact to the state operating budget. On Sunday, the coalition made “robo-calls” across the state encouraging citizens to show up at the State Capitol in opposition of the alternative bills. Coalition members packed the committee room.
Robideaux said he did not phone the Jindal administration about his decision. He said he told Kleckley. “Knowing that the end result was going to be defeat of the bills, I just didn’t think it was a necessary issue,” he said.
Robideaux said a number of factors doomed the bills, including questions about how the revenue would be replaced. Next door, the House Appropriations Committee recently heard testimony that the state is so strapped for cash that funding to battered women’s shelters is being cut.
State Rep. Hunter Greene, who wanted to take his third crack at phasing out the state income tax, voluntarily deferred his legislation after Robideaux’s announcement.
“I’ll be talking to members of the committee and hope that there might be a solution we can get to,” Greene said.
Newly elected state Rep. Barry Ivey, R-Central, also pulled his proposal to phase out the state personal income and corporate taxes. “There’s a lot of people for tax reform, they just happen to be working and paying taxes,” Ivey said.
State Rep. Regina Barrow, D-Baton Rouge, consoled Ivey.
“The longer you stay in the process, the more disappointments you will have,” Barrow said.
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