Editorial: State's budget tied to success of tax amnesty program

Buoyed by surprising success three years ago, Louisiana’s state government plans another tax amnesty program.

The idea is to help residents and corporations clear up any unpaid taxes while producing necessary revenue for the current

fiscal year’s budget.

Gov. Bobby Jindal first called for the

amnesty program as part of his plan to do away with personal and

corporate income taxes

and replace them with a higher state sales tax. When lawmakers

pronounced that notion dead on arrival at the opening of this

year’s regular legislative session, Jindal’s amnesty program

evaporated.

But with the state cash-strapped, lawmakers cobbled together an amnesty plan they hope will produce $200 million for this

year’s budget.

The plan is front-loaded with incentives to lure those who owe the state taxes to pay sooner rather than later.

According to the amnesty legislation,

for a two-month period this fiscal year, all penalties and half the

interest owed on

a state tax bill will be waived. Next year for one month, only 15

percent of the penalties will be waived. And for one month

during the 2015-2016 fiscal year, only 10 percent of the penalties

will be waived.

In 2010, a similar tax amnesty program produced more than $482 million in revenue for the state.

The state Department of Revenue

declined last week to estimate what it is owed, but earlier this year

the Legislative Fiscal

Office estimated the bill at $700 million. It also predicted that

about 10 percent of the 300,000 debtors, the vast majority

of which are corporations and companies, will participate.

State Rep. Joel Robideaux, R-Lafayette, chairman of the House Ways and Means committee, said only a small percentage of those

that owe the state are individual taxpayers.

He said the bulk of the money is owed

by corporations that dispute their tax bill and pursue legal means in

hopes of a settlement

to ease their payment.

The hitch here is that the Legislative Fiscal Office has estimated that this year’s amnesty program will net the state between

$150 million and $175 million. With lawmakers’ optimistic view of $200 million being plugged into the current budget, any

shortfall would likely impact the usual victims, state health care and higher education.

The stakes then are high, and so is the responsibility of the state to ensure that all taxpayers pay their share. Consequently,

the vast majority of residents should hope this endeavor succeeds.

• • •

This editorial was written by a member of the American Press Editorial Board. Its content reflects the collaborative opinion of the Board, whose members include Bobby Dower, Jim Beam, Crystal Stevenson and Donna Price.