Louisiana prides itself on being the most unique state in the country. From our amazing cuisine to our unmatched hunting and fishing, there is no place in this country as wonderful as Louisiana. Our state’s tax system, however, is a much different story. While it is unique, it is neither amazing nor wonderful. In fact, Louisiana’s current tax system is a factor that drives Louisianans to other states, away from our notable culture. Like anything else that is disruptive to our state, there is no time like the present to begin taking the necessary steps to course correct.
Louisiana’s current reality is that it features a tax code that is longer than the New Testament and more suspect than the NFL’s referee corps. The fact of the matter is that our rates are too high to be competitive with our neighbors, so we offer carve-outs and exceptions as a fix in the place of fundamental reform.
Thanks to the actions of the legislature, amendment #2 would put in motion the process of reforming and simplifying our tax code by beginning to trade those carve-outs for an income tax code that features lower rates and simplicity. To start, the state’s individual income tax rate would drop to the lowest in the Southeast among states that levy an income tax. With passage, a cap would be placed on the income tax at 4.75%, lowering rates for all taxpayers across the board. The current cap is 6%.
States all across the Southeast are attracting jobs because of their low rates. With Texas, Tennessee, and Florida featuring no income tax, and Mississippi moving in a similar direction, Louisiana cannot afford to stick out like a sore thumb and continue to lose jobs to those states. As our economy recovers from the COVID-19 pandemic, we should signal that Louisiana is a safe haven for people looking to create jobs and opportunities. Voting yes on amendment #2 means protecting Louisiana from being outcompeted by our neighbors in the Southeast and securing a better economic future for our families.
In exchange for the lowering of rates, amendment #2 would remove the deduction for federal income taxes paid. This is yet another item on a long list of examples where Louisiana’s unique tax code hurts its citizens. Most recently, this bug in our tax code caused our income taxes to automatically increase as a result of taxes decreasing on the federal level.
There is a reason this amendment has broad support. Amendment #2 would make it easier to live, work and create jobs in Louisiana. Voting yes on this amendment means voting yes for a Louisiana that is more competitive with our neighbors, encourages more job growth, and brings more opportunities for our families.
Voting yes on amendment #2 to make our tax code more friendly for families and job creators should be a no-brainer for those who want to see progress for Louisiana’s future. This amendment is a strong solution to long-standing problems that our state has dealt with for far too long. Louisiana’s economy was struggling long before the COVID-19 pandemic. If we want to work toward bold reforms that bring back opportunities to our state, we should be unified in support for constitutional amendment #2.
Daniel Erspamer is CEO of Pelican Action