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Reasonable approach to abolish income taxes
 Abolishing all income taxes in Louisiana is a wonderful idea on the surface. Every business in the state and every individual who makes enough money to actually pay state income taxes would benefit from having more money in their own pockets to spend as they saw fit.
Sen. Rob Marionneaux's proposal, though, to do away with all corporate and personal income taxes came out of nowhere in the regular legislative session. It appears the Legislature as a whole as well as Gov. Bobby Jindal are not in the mood to deal with an eventual loss of roughly $3 billion in revenues while there's no game plan on the horizon to deal with it in a realistic manner.
I know what you're thinking. You probably are thinking a $3 billion hit to the state's bottom line isn't such a big deal in light of the state's anticipated $24.9 billion budget for the 2011-2012 fiscal year. The new fiscal year begins July 1.
The $24.9 billion figure is misleading, meaning roughly $17 billion - $18 billion of it is off limits. Those monies are either constitutionally and/or statutorily dedicated or they concern federal funding, and federal funding for states comes with strings attached to it. In other words, states take money from Uncle Sam and Uncle Sam instructs states on how to spend it. No ifs, ands or buts.
That leaves a state like Louisiana with a roughly $7 billion - $8 billion general fund budget. Of that budget, roughly $2 billion will be spent on health care in the new fiscal year. Some $1.2 billion will be appropriated for higher education while roughly $500 million will be dropped on corrections. Meanwhile, the state is constitutionally directed to spend some $3.5 billion on elementary and secondary education. Those are constitutionally dedicated dollars on top of the $17 billion - $18 billion mentioned previously in this offering.For the full story, subscribe to the The Concordia Sentinel's NEW E-Edition! |
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