House Speaker Chuck Kleckley. (Associated Press)
Last Modified: Wednesday, April 03, 2013 7:29 PM
BATON ROUGE — House Speaker Chuck Kleckley said Wednesday that lawmakers won’t vote on Gov. Bobby Jindal’s tax plan until they get their own financial analysis of the bills, a review that will slow any efforts to move the tax overhaul to passage.
The two-month regular session begins next week. But Kleckley, R-Lake Charles, said the House Ways and Means Committee, which is the first stop for Jindal’s tax package, won’t take action on the bills until it hears from the Legislative Fiscal Office (LFO).
That analysis isn’t expected for about two weeks.
“We’ll sit back and wait for the LFO numbers. We’ll be comfortable with those numbers,” Kleckley said. He added, “There’s no sense in moving something forward and having debate on something until we have accurate, hard, believable numbers.”
Jindal wants to eliminate state income taxes for individuals and businesses. To make up for the lost revenue, he wants to boost the state sales tax rate from 4 percent to 6.25 percent, charge the higher sales tax rate on previously untaxed services, increase the tobacco tax and remove dozens of tax breaks.
Competing data has been circulated about the effects of the Republican governor’s tax package, and the Jindal administration’s own numbers have changed several times, along with central pieces of the proposal.
Several groups have raised questions about the economic assumptions used in the Jindal administration figures, and the changing data has prompted some lawmakers to suggest the tax proposal can’t win legislative support in the short, two-month session.
Kleckley said more information was needed about how the governor’s proposal would affect businesses and individuals — and whether the tax swap is “revenue neutral,” so that the state treasury doesn’t gain or lose revenue from the restructuring.
“There’s been so many confusing and conflicting stories on the numbers,” Kleckley said in a luncheon with reporters.
Rep. Mike Danahay, D-Sulphur, sits on the House Ways and Means Committee. He said Jindal’s tax plan is too complex and comprehensive to be rushed through the legislative session.
“What I’ve said from the beginning is that time is the issue here,” Danahay said. “We certainly don’t want to get in a situation a year from now where we’re looking at a massive revenue shortage because of the actions we took.”
The House speaker said he thinks broad support exists among legislators to get rid of income taxes, but he said there’s less agreement on how to offset the $3 billion gap that would be created with the removal.
Raising taxes to fill the hole would require a two-thirds vote, and Jindal has said he’ll veto anything that isn’t revenue neutral.
Kleckley echoed Jindal’s statements that the current tax structure is outdated and too complicated. But he didn’t give a specific endorsement to the governor’s proposal. He also raised concerns about a central tenet of Jindal’s tax swap that would shift an estimated $500 million in tax costs from individuals to businesses.
“If it’s going to have an impact on small business or any business for that matter, it’s going to be hard for me to support that,” Kleckley said.
Danahay said that shifting the tax burden from indivduals to businesses could end hurting consumers.
“I can’t help but think it will come back in some form or fashion to the individuals,” he said. “When you’re shifting money around, the public and small businesses could be the loser.”
The powerful Louisiana Association of Business and Industry opposes the Jindal tax swap because the administration says it would increase tax costs for companies.
The Jindal administration says the tax overhaul would be fairer for all, close special interest loopholes and give business a more predictable tax burden that could be controlled by choosing whether to buy certain goods and services.
• Staff writer John Guidroz contributed to this report