250 clergy call Jindal tax plan unfair to poor - FOX 8, WVUE, fox8live.com, weather, app, news, saints

250 clergy call Jindal tax plan unfair to poor

Photo from gov.state.la.us Photo from gov.state.la.us

BATON ROUGE, La. (AP) - More than 250 Louisiana clergy members said they oppose Gov. Bobby Jindal's tax swap proposal because it is unfair to the poor and threatens state services, according to a letter delivered to the governor's office Monday.

Jindal proposes to get rid of Louisiana's personal income tax and corporate income and franchise taxes. To offset the loss, the governor wants to increase the state sales tax by 47 percent, from 4 percent to 5.88 percent, and to charge sales taxes on more services.

When combined with local sales taxes, Louisiana would have the highest average sales tax nationwide.

The clergy members said that poorer families would pay a disproportionately larger share of their income in taxes than wealthier families under the plan.

They also said that sales taxes grow more slowly than income taxes, so it would cost the state lost revenue in later years that could force cuts to government services.

"We believe that any proposed law that would increase the tax burden on low- and moderate-income families or that would threaten the long-term fiscal soundness of our state must be judged an unjust law," the religious leaders said in the letter.

The tax swap will be considered by lawmakers in the upcoming regular session that starts next month.

The governor said tax rebate programs for low-income families and for some retirees would help offset the increased sales tax costs for people who don't currently pay income taxes, along with existing sales tax breaks on food, medications and residential utilities.

The Jindal administration says a "vast majority of Louisiana taxpayers" will save money through the tax swap.

This is not an attempt to do tax reform on the backs of the poor," said Tim Barfield, the governor's point person on the restructuring effort.

Because the actual legislation and data analysis hasn't been released yet, it remains difficult to determine the real winners and losers of Jindal's proposal.

To keep the tax code rewrite "revenue neutral," as Jindal wants, some people and businesses will have to pay more to offset the costs of others paying less.

Barfield said businesses will bear much of the increased cost to produce savings for families, but at the same time those companies will get to pick and choose how they pay taxes because they can decide what goods and services they want to buy.

Also, he said the tax structure will be less complex and easier to navigate.

"There will be a transfer of the burden to businesses, but we think there will be a lot of benefits to businesses that make this palatable," he said.

Religious leaders from a variety of faiths, including clergy from Baptist, Episcopal, Methodist and Unitarian churches from more than 70 cities and towns across the state signed the letter opposing the governor's plan.

Signers included the bishop of the Episcopal Diocese of Louisiana, the bishop of the Louisiana Annual Conference of the United Methodist Church and president of the Southern Baptist Convention.

The letter says even before Jindal's proposed changes, Louisiana already has a regressive tax structure in which families earning less than $16,000 per year pay 10.6 percent of their income in state and local taxes, while families earning over $1 million per year pay 4.6 percent.

(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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