Sunday, July 21, 2024

‘Diaper bill’ to exempt certain products from sales tax back on radar of state legislators

by BIZ. Staff

By Hunter J. Lovell, LSU Manship School News Service

BATON ROUGE- Louisiana lawmakers signaled support for legislation that would exempt diapers and feminine hygiene products, including tampons, from state sales tax. 

The so-called “tampon tax” or “diaper bill” is back on the radar. The bills were filed by Sen. J.P. Morrell, D-New Orleans, who received a lot of pushback in 2017 when he introduced similar proposals. 

Both bills — one to exempt the products from state tax and the other to give local government the option to exempt them from local taxes — are co-sponsored by Rep. Walt Leger III, D-New Orleans. 

Low-income families and poor people often struggle to afford health and wellness products, which are currently taxed at the regular rate.

“There are moms that can’t afford diapers,” Morrell said. “They have to go basically to a food bank for diapers to provide diapers for their children. Diapers are expensive, and if you’re paying 30 to 40 bucks for a large pack of diapers, you’re paying $3 to $4 of tax on top of that. For some of these low-income families that makes or breaks the bank.” 

Thanks to a bipartisan compromise last year that prevented part of the state’s sales tax from expiring, Louisiana lawmakers from both parties may have more room to make tax exemptions like this now. 

“It’s easier to pass a small tax relief measure in years like this when the state has stable revenue than it has been in years past when we were facing major budget deficits,” Louisiana Budget Project Executive Director Jan Moller said.

If Morrell’s bill becomes law, Louisiana’s sales tax would no longer apply to baby diapers as well as tampons, menstrual pads and sanitary napkins, pantiliners, menstrual sponges and menstrual cups. 

Estimates on how much tax exemptions for diapers and feminine hygiene products would cost range from $9 million to $10 million in tax revenue annually. 

Under the state constitution, necessities such as prescription drugs, groceries and utilities are already tax exempt. 

“The state should not tax things that are not luxury items,” Morrell said. “For me, it’s kind of offensive that we don’t tax Viagra what we tax tampons because you physically cannot function in polite society without tampons. And it’s not like babies are allowed to run free buck-naked from the waste down until they’re potty trained.”

If approved by lawmakers, the public would vote on the state tax exemption in a statewide referendum later this year.

Not all proposals gained as much traction. 

The Senate Committee on Revenue and Fiscal Affairs also discussed whether to direct a portion of the 0.45-percent sales tax that was extended last year to the Transportation Trust Fund to pay for road and bridge projects.

A bill proposed by Barrow Peacock, R-Shreveport, was deferred 5-3 after Democrats argued against any amount being siphoned away from the State General Fund.

Department of Revenue Secretary Kimberly Robinson — a member of Gov. John Bel Edwards’ cabinet — emphasized the administration’s opposition to Peacock’s bill. 

Robinson said that though the administration acknowledges the need for infrastructure improvement, Peacock’s move to siphon hundreds of millions of dollars from the general fund would cripple the budget.

“Right now we are trying to get a budget for this year that funds teacher pay raises and additional revenue,” Robinson said. Edwards has proposed a $1,000 increase in pay for teachers across the state.

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