Post by pavel on Mar 7, 2016 9:14:16 GMT -6
Local governments, businesses not happy with talk of sales tax increases
A week ago, Louisiana legislators were poised to approve a penny sales tax increase, which would be the most significant tax increase state government has passed in decades. It’s a move that would secure firmly Louisiana’s No. 1 spot for highest combined rate of state and local sales taxes on goods and services.
This week, short on answers and desperate for solutions, lawmakers who have until Wednesday to close the $900 million midyear budget shortfall, are giving serious consideration to adding another half or full penny on top of that.
Traditional opponents to a sales tax increase have mostly held their tongue for the majority of the three-week legislative session, which has centered around the single penny increase, noting that the alternative to not raising the revenue would have devastating consequences across the state. Still, critics are quick to point out that a sales tax increase of any size disproportionately hurts the poor, and local governments say the hike could thwart their own abilities to raise taxes for local projects in the future.
Municipalities and districts charge varying sales taxes to support local government services, but on average, the local sales tax rate is about 5 percent. The state sales tax is 4 cents, so the single penny increase alone — which legislators seem mostly in agreement to pass — would mean that moving forward, the average Louisiana consumer will spend at least about a dime in taxes for every dollar they spend on routine purchases like new socks or a hamburger at a restaurant. (Groceries and prescription drugs are sales-tax exempt.)
Read more: theadvocate.com/news/15072864-113/local-governments-not-happy-with-talk-of-sales-tax-increases
A week ago, Louisiana legislators were poised to approve a penny sales tax increase, which would be the most significant tax increase state government has passed in decades. It’s a move that would secure firmly Louisiana’s No. 1 spot for highest combined rate of state and local sales taxes on goods and services.
This week, short on answers and desperate for solutions, lawmakers who have until Wednesday to close the $900 million midyear budget shortfall, are giving serious consideration to adding another half or full penny on top of that.
Traditional opponents to a sales tax increase have mostly held their tongue for the majority of the three-week legislative session, which has centered around the single penny increase, noting that the alternative to not raising the revenue would have devastating consequences across the state. Still, critics are quick to point out that a sales tax increase of any size disproportionately hurts the poor, and local governments say the hike could thwart their own abilities to raise taxes for local projects in the future.
Municipalities and districts charge varying sales taxes to support local government services, but on average, the local sales tax rate is about 5 percent. The state sales tax is 4 cents, so the single penny increase alone — which legislators seem mostly in agreement to pass — would mean that moving forward, the average Louisiana consumer will spend at least about a dime in taxes for every dollar they spend on routine purchases like new socks or a hamburger at a restaurant. (Groceries and prescription drugs are sales-tax exempt.)
Read more: theadvocate.com/news/15072864-113/local-governments-not-happy-with-talk-of-sales-tax-increases