Ball is in Legislature's court

LOUISIANA LEGISLATURE — Now that Democratic Gov. John Bel Edwards has been re-elected, the big question is whether the Republican controlled Legislature will work with him to reform the complex state tax code.

Democratic Gov. John Bel Edwards won a second term Saturday against heavy odds, but where does the state go from here? For the most part, Edwards worked well with the Republican controlled Legislature for four years, but the reforms needed to get Louisiana off the bottom of most state rankings went nowhere.

Republican state Treasurer John M. Schroder was a representative in 2016 that created the Task Force on Structural Changes in Budget and Tax Policy. Its goal was to begin tax and budget reform in 2017, but it didn’t happen. Some speculated it was because Republicans weren’t interested in giving Edwards any credit that might help him win a second term. Now that Edwards is term-limited and can’t run for governor in 2023, will the Republicans who now have firmer control of both the House and Senate again refuse to begin those reforms?

We can only hope that Lionel Rainey, a Republican political consultant, doesn’t speak for all GOP legislators. Governors and legislators are supposed to work together for the good of the citizens they serve, but Rainey thinks otherwise. The Associated Press reported what Rainey said Monday on talk radio.

“We lost a huge battle with the governor’s race, but we’re getting ready to fight a war for the next four years, and our front line of defense is going to be the Louisiana Legislature,” Rainey said.

Rather than a war with the governor, Republican lawmakers should be working on tax reform that is the quickest way to get Louisiana off the bottom of all those state rankings the GOP talked so much about during the gubernatorial campaign.

The conservative Tax Foundation in Washington, D.C., and three reputable state economists in 2015 laid out thorough tax reform programs that should be the Legislature’s first order of business.

Tax Foundation called Louisiana’s sales tax one of the most unique and challenging of any in the country. It suggested unifying state and local sales tax collections and expanding the sales tax to include select services, neither of which is popular. However, that would make it possible to lower the sales tax rate.

The state income tax could be improved by broadening the tax base and reducing tax rates, which the foundation said would make the state more competitive with its neighbors and the system more neutral and fair. Louisiana also has too many income tax exemptions for both individuals and corporations. Reducing them would also make it possible to lower income taxes.

Infrastructure (roads, bridges, ports and airports) poses the biggest challenge, and lawmakers have to figure out how to finance more maintenance and construction.

The foundation said, “The menu of choices we present all ensure that the state builds a tax system for a diversified economy and positions itself as a destination for investment, entrepreneurs and talented individuals in the years ahead…”

Another excellent reform plan is outlined in the Louisiana Tax Study, 2015, done by Dr. Jim Richardson of LSU and Drs. Steven Sheffrin and James Alm, both of Tulane University. The three economists said, “From an economist’s perspective, the guiding principles of constructing a state tax structure include broad tax bases (meaning minimizing exemptions, credits and rebates), allowing for low tax rates that typically contribute to simplicity of the tax structure, equity among taxpayers, long-term stability of the tax system and the adequacy of paying for the public services demanded by the electorate.” Three Republican House members over the last four years have sponsored legislation designed to achieve many of the goals recommended by the two tax reform studies. The sponsors were Reps. Barry Ivey of Central, Jay Morris of Monroe and Julie Stokes of Kenner. Ivey was re-elected without opposition, Morris won a close race for the Senate, and Stokes declined to seek re-election.

Unfortunately, the Republican leadership in the House wasn’t interested in enacting any of those bills. Whether the next leaders of the House and Senate are ready to take the hard votes necessary to get some tax reform done won’t be known until they take office next year. However, nothing is going to change if legislative leaders, like Rainey, plan to go to war over the next four years.

Edwards won a narrow victory Saturday, but it’s like those football games that Louisianans love so much. A win is a win, and those who are victorious always enjoy the satisfaction and the fruits of victory.

The Advocate reported Tuesday that President Trump, who bashed Edwards and his record during three rare state visits, called Edwards Monday afternoon to say he “ran a hell of a campaign.” The newspaper said Trump added that he looked forward to getting back to work with his one-time ally.

Now it’s time for Republican state legislators who are in charge to make the same commitment to work with Edwards to move Louisiana forward and off the bottom of those state rankings.

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