Special Session Ends – Part of Penny Tax Will Be Renewed
The special session is a wrap after lawmakers reached a last minute deal to keep part of the temporary penny sales tax on the books.
Sunday night, lawmakers reached a deal on the budget to raise $463 million in taxes by keeping .45 cents of that penny on the books for seven years. The Governor says this will avert hefty cuts to public colleges, TOPS and public safety programs.
The penny was supposed to fall off the books on July 1st, but with this compromise, the state sales tax rate will fall from 5% to 4.45%. Several sales tax breaks for people and companies, including an exemption from sales taxes on business utilities, also will be scaled back during the period.
House Speaker Taylor Barras supported this measure saying this will help avoid drastic cuts to several state agencies.
The final deal will bring in about $100 million less than Governor Edwards wanted, but he still says this is a victory.
"I'm looking forward to the seven years of stability we're going to get," Edwards said.
But Shreveport Rep Alan Seabaugh is not happy about this action. He believes the state can fully fund our priorities without increasing taxes. He says "Please remember this betrayal when they ask for your vote for re-election or when they run for other offices in the future."
The final vote on the bill in the Senate was 33-6.
Here is part of the statement issued by the Louisiana Democratic Caucus:
“Ladies and gentlemen, the ghost of Bobby Jindal has finally left the building. After recklessly spending the nearly $1 billion surplus he inherited from the prior administration, Jindal left behind a legacy of policies which continued to haunt Louisiana with massive annual deficits and years of budgetary chaos. Now, Louisiana can move onward from the fiscal instability of Jindal-era politics. This solution isn’t ideal, but compromise never is. Our Caucus will not stop fighting for responsible budgeting and real tax reform that values Louisiana’s working families. But today, we are proud to have played a key role in negotiating a deal that will keep critical services funded, and offers a tax break to every Louisianan.
The operating budget for Louisiana which begins on July 1st is $29 billion dollars.