Expected vote on proposed tax bills did not happen in legislature

Expected vote on proposed tax bills did not happen in legislature
Updated: Feb. 26, 2018 at 8:55 PM CST
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NEW ORLEANS (WVUE) - Progress some hoped would happen at the state capitol to erase the latest budget shortfall did not happen Monday. Critical votes in the state house on a package of tax bills was called off.  Republicans and democrats are not seeing eye-to-eye on some legislation.

After coming into session two hours behind schedule, the House convened, but republican House Speaker Taylor made it clear much compromise was still needed.

"A great deal of trust and some reaching across the aisles to pull this off," Rep. Barras said.

On July 1, a billion in temporary taxes expire. That will leave a giant hole in the state budget unless more revenues are realized, or deep cuts are made.

"We definitely have an ongoing structural budget problem and I'm afraid it won't be cured with temporary tax increases," said Tulane University economist Steven Sheffrin, Ph.D., who served on a task force created by the legislature to come up with long-term solutions to the state's seemingly perpetual budget issues.

Governor John Bel Edwards is against extending the temporary 5th penny of the state sales tax.

But a bill backed by some house republicans calls for keeping one-quarter of the extra penny for three years.

"I'm afraid that's not going to really do much. They could do other things, they could clean the other pennies of the sales tax," said Dr. Sheffrin.

Governor Edwards proposed many of the task force's recommendations last year but was not successful in getting them through the legislature. He added some of the recommendations to his wish-list for the special session.

This week, members of the legislature's Black Caucus said they want income tax changes to benefit the budget, in exchange for supporting the proposed one-quarter cent sales tax extension.

Dr. Sheffrin said modifying the state's income tax law was part of the task force's recommendations, too.

"That's something our report was actually pretty solid on. We wanted more income tax collection," Sheffrin stated.

And Dr. Sheffrin said the business community should also be concerned about high sales taxes in La.

"It falls on businesses, when businesses purchase goods not all of them are exempt, so they pay higher sales tax…so I would hope the business community would actually recognize this and not try to lean so much on the sales tax and maybe lean a little bit more on the income tax and that was our motivation on the task force," Sheffrin continued.

A Dillard University Professor of Urban Politics said partisan views influence budget battles at the state capitol.

"The problem here is that you have a governor and the legislature who because they are of different political parties have significantly different philosophies on spending, on budgeting, on deficits," Dr. Collins told FOX 8 News last week.

Dr. Sheffrin is not optimistic the budget crisis will be resolved during the special session.

"But even with getting rid of Excess Itemized Deductions and even the temporary one-quarter percent sales tax, that's not going to be enough, so they're still going to have to come back to the drawing board," he said.

A vote on the taxes in the house could happen Wednesday.

The special session must end March 7, and the regular session ends soon after the current session.

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