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C100 Vignette Series: #1 There is Real Need for Tax Reform

 

 

Louisiana badly needs to get its fiscal house in order. After repeated budget shortfalls, budget cuts, temporary tax increases, and a host of other patchwork legislation, it is time to take this head on. The current system has failed us all and we desperately need bold action—from the Governor’s Office to the legislative leadership to the rank-and-file.
 
Over the past 8 years, repeated budget cuts have fallen largely on healthcare and higher education. Healthcare cuts impact hospitals, nursing homes, physicians, home health, EMS and other critical services. During this time, state support for higher education has been reduced by $1.6 billion, with students now footing most of the bill. This bad trend impacts community colleges, four year universities, and graduate schools. That hurts our quality of life and workforce capacity.

 

Drastic cuts continue today, even after the legislature raised $715 million in temporary taxes in 2015 and another $1.5 billion in 2016 that were supposed to even things out until the state economy and related revenues recover. Neither materialized, as the state now faces a mid-year deficit of $300M to be addressed in a February Special Session and a greater deficit projected next fiscal year starting July 1. This vicious cycle will not end without serious intervention--- REAL TAX REFORM!

 

Beyond deficits and cuts, we have a tax structure that does not allow for adequate investment into our infrastructure, ports, roads, and bridges. It does not allow us to pay down our debts of unfunded accrued liabilities, or to build up our coastal defense. It does not allow us to replenish our state mega fund for major economic projects. It does not allow us to invest dollars into biomedical research or accommodate those families waiting on Medicaid waivers. Bottom line, we are barely getting by and WE CAN DO BETTER!

 

For its part, the Committee of 100 is trying to be a change agent, conducting listening sessions around the state with community leaders to highlight the tax reform proposals, increasing public awareness, and building on its earlier tax work through the well-respected Tax Foundation. Much of the 2014 Tax Foundation findings and recommendations are consistent with the HCR11 Task Force proposals.

 
The policy goals are clear: establish a long-term, stable foundation for Louisiana’s finances, generating sufficient revenues for state services while making the tax code fair, easy to comply with and competitive with other states. The HCR11 report provides a pathway to get there through specific tax policy changes embodied in a comprehensive package, backed by good government groups like PAR and CABL who called it “a strong step forward for Louisiana.”

 

 

The Task Force full report released 1/27/17


 

 

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