Louisiana voters give mixed decision to ballot’s tax changes
BATON ROUGE, La. (AP) — Louisiana voters Saturday appeared to make a split decision on Republican legislative leaders’ push to rewrite tax laws, agreeing to detangle state income tax collections from federal tax payments but refusing to centralize sales tax collections, according to election results from the secretary of state’s office.
The complex tax proposals, championed by business lobbying groups, were among four changes to the Louisiana Constitution on the ballot — and the only issues facing all voters statewide.
The Associated Press did not tabulate the race results. But complete, uncertified election results posted by Louisiana Secretary of State Kyle Ardoin’s office showed 52% of the more than 410,000 voters who cast ballots opposed the sales tax measure and 54% supported the income tax change. Certified results take several days.
The tax amendments were backed overwhelmingly by Republican and Democratic lawmakers and by Democratic Gov. John Bel Edwards.
Supporters called the measures a step toward reform for an unnecessarily complex state tax structure. But outside organizations criticized the sales tax proposal as a state power grab and the income tax measure as too generous to businesses and the rich at the expense of the poor.
The election was delayed five weeks because of Hurricane Ida.
CONSTITUTIONAL AMENDMENT 1
The failed first amendment would have started the process for consolidating sales tax collections through an eight-member commission, rather than through more than 50 local government agencies ranging from sheriffs to school boards.
Local government associations would get four seats on the commission. The revenue department, the governor, the House speaker and the Senate president would appoint the other four members.
Supporters said Louisiana is one of only three states that handle sales tax collections through such a hodgepodge of local government agencies. They said that makes it too complex and costly for businesses that have to collect and remit sales taxes across multiple parishes.
But the details of how the commission works still would have to be decided by lawmakers in a future legislative session, and that had some questioning the effort.
Meanwhile, New Orleans Mayor LaToya Cantrell came out strongly in opposition to giving up her collection authority and argued the commission could withhold sales taxes owed to municipalities when state officials are unhappy with local decisions.
CONSTITUTIONAL AMENDMENT 2
Passage of the second tax amendment will trigger enactment of a package of bills getting rid of personal income tax and corporate tax deductions for federal income taxes paid in exchange for lowering income tax rates.
Louisiana also will eliminate the corporate franchise tax for small businesses, lower the rate for others and do away with most excess itemized deductions taken by middle- and upper-income earners.
But voters didn’t necessarily know that from the one-sentence ballot language, which suggested voters were deciding simply whether to cut their taxes — rather than settling a tax tradeoff that won’t give everyone a reduction in their tax bills.
Supporters said the current system makes Louisiana’s tax collections too volatile and hard to control. When federal income taxes go up, Louisiana collects less in state taxes. When federal income taxes go down, state tax collections rise.
Opponents said the tax swap will more heavily benefit corporations and wealthier residents. They criticized triggers in the legislation that will lower tax rates in later years if Louisiana hits certain revenue growth, rather than allowing the state to spend that money on health care, education and other services. And they objected to a provision that will bar lawmakers from being able to raise personal income tax rates above 4.75% without getting voter approval.
An analysis by the Legislature’s nonpartisan economist Greg Albrecht said most individual income taxpayers who don’t itemize will see a tax cut while those who itemize likely will pay more, and estimated fewer than 2% of those who file corporate taxes will see tax bills rise.
Voters also overwhelmingly rejected the two remaining constitutional amendments, according to results from the secretary of state’s office. Those proposals would have allowed some local levee districts to increase their taxing authority and let lawmakers cut more deeply into protected funds when the state faces a budget deficit.
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