Gov. Bobby Jindal’s latest policy desideratum is to do away with the Louisiana income tax and replace it with a “revenue-neutral” alternative. We should all know by now that he, the quintessential Republican, will not authorize any real tax increases. What he will propose will most likely involve an increase in sales taxes, however.
Among complaints has been the justified concern that such an income tax substitute would hit the poorest citizens of Louisiana the hardest, many of whom pay no income taxes at all. There would be others hit hard as well, including those of us who, in our sadly misnamed Golden Years, although not impoverished, live on income from Social Security, pensions and annuities exempt from Louisiana income taxes. It would also put an additional burden on those who are currently out of work who depend mostly on unemployment compensation.
Further, it is an extraordinarily bad time to promote a sales tax increase. Unless a law or laws requiring online retailers to collect state sale taxes are enacted federally, states will be spitting to windward in their efforts to make online purchasers responsible for those taxes. I wonder how many people in Louisiana even know that they are expected to keep such records, much less actually pay sales taxes with their state income tax filing. It is a complicated problem, as some state taxes are collected by online sellers, depending on whether or not they have a physical presence in the state.
Frankly, it is ridiculous to expect buyers to keep such records. Sales tax collection should be the business of the seller, not the buyer. In any case, should an increase in sales tax be the countermeasure to the abolition of the state income tax, I think the chief beneficiary is more likely to be Amazon.com than the people of this state.
retired university professor