A decade ago the Louisiana Committee of 100 for Economic Development funded a study to analyze Louisiana’s tax structure by the organization Tax Foundation. This group is widely accepted nationally as the lead organization in this work across the nation.
The hope then was to begin a conversation on building a foundation for tax and fiscal reform in our state – one that would attract job creators to come and stay in Louisiana. We sought for our state to be bold about creating jobs and encouraging opportunity and entrepreneurship for the people of our state.
Constitution Amendment 2 is the foundation of changing a complex and noncompetitive tax environment to one that is fair, simple and competitive for individuals and businesses – a way to compete with our neighboring states to the east, west, and north. It is the culmination of the conversation begun with the Tax Foundation report.
On the ballot on March 29, Louisiana voters are deciding the fate of this new amendment that rewrites the entire article 7 of our state’s constitution. It is the largest most consequential amendment voters have been presented with since the approval of the current constitution in 1974. Leaders for a Better Louisiana and Louisiana Committee of 100 strongly support its passage.
During the November special session of the legislature, law makers made a number of high profile changes in state tax policy. The result of those changes is lowered individual income tax and corporate income taxes, increased city and state sales taxes to offset some of the revenue loss, and elimination of a number of tax deductions that don’t necessarily boost Louisiana’s economy.
In broad terms, the proposed constitutional amendment enacts significant changes to policies dealing with state and local taxes, government spending and state savings accounts. It also streamlines the constitution, gives the legislature more flexibility over fiscal issues, and uses almost two billion dollars now invested in three different trust funds to eliminate an equal amount of debt in the state’s teacher retirement system.
This amendment is important to all because it lowers the maximum income tax rate; doubles the standard deduction on income taxes for seniors; provides a significant protected teacher pay raise; and requires a 2/3 vote to create or change tax exemptions or credits.
Equally important, the amendment keeps important protections. There will be no changes made in sales tax exemptions at home, residential utilities and prescription drugs. Constitutional protections of the “Rainy Day” fund, Coastal Protection and Restoration Fund, Transportation Trust Fund; Homestead Exemption, and the requirement for a balanced budget will remain.
This rewrite of Article 7 of the constitution is a major achievement of leadership by the governor and legislature. It addresses problems we have talked about for years. It will make Louisiana much more competitive in economic development. And it will create the foundation fiscal policy that supports a thriving Louisiana.
Our goal at Leaders for a Better Louisiana is to be part of transforming Louisiana into a dynamic future ready economy that offers every citizen and business the opportunity to thrive. This constitutional amendment is the foundation of changes now and improvements in the future.
For these reasons, Leaders for a Better Louisiana strongly supports Amendment 2 and joins with many business, education, and good government groups giving their approval of this important rewrite of a major piece of our constitution.
Dr. Phillip Rozeman is a practicing cardiologist and co-chair of Leaders for a Better Louisiana that represents the union of the Council for a Better Louisiana (CABL) and the Committee of 100 for Economic Development (C100).