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Governor seeks alternative to his proposed gross receipts tax plan

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Governor seeks alternative to his proposed gross receipts tax plan

Governor seeks alternative to his proposed gross receipts tax plan

By William Taylor Potter / Manship School News Service

BATON ROUGE — Gov. John Bel Edwards had a message for Republicans opposing his plans for tax reform: Chart a new path.

The call to action came during his State of the State address – the second of Edwards’ tenure – that opened the 60-day Louisiana State Legislature’s 2017 regular session. Much of the speech centered on the governor’s proposals for tax reform, which includes eliminating one penny of the five-penny sales tax and implementing a commercial activity tax (CAT) for businesses.

A tax on commercial activity would measure gross receipts at various levels, with smaller businesses getting hit significantly less. A gas station with $500,000 in taxable gross receipts would pay $250, noted the governor by way of example, while a doctor’s office with $2.5 million in fees would be taxed $1,500.

Edwards addressed Republicans and their steady opposition to his efforts, saying he was open to compromise but added he had seen “very little constructive input and no constructive action.”

“We cannot continue down the path we are currently on,” Edwards warned the senators and representatives sitting in a joint session. “It’s unsustainable for our state. And we can’t keep moving the goal post because it’s politically advantageous.”

The governor said he could respect those who disagreed with his proposals so long as they offered legitimate counter proposals. He said he could not respect those who “[vote] ‘no’ on everything without offering their own proposal.”

Edwards also hawked to the Republican dominated body several non-fiscal proposals, including equal pay legislation for females and criminal justice reform. He said his initiatives for the criminal justice system, which include “cleaning up” the criminal code and broadening probation eligibility, would reduce the state’s prison population by 13 percent and save $300 million over 10 years.

On equal pay, Edwards said the state should be “offended” by its wage gap, noting that Louisiana has the highest in the nation with a woman making 66 cents for every $1 a man makes. He also called for an $8.50 minimum wage floor over the next two years.

Rep. Robert Shadoin, R-Ruston, said he does not see the “political will” in the House to affect fiscal reform this session.

“I have not picked up the sense that we will do any meaningful budgetary or financial reform during a fiscal session when that should be our focus,” Shadoin said after the governor’s speech. “We got 60 days to try to focus on the way we do our budget from the bottom up because obviously the way we’ve been doing it doesn’t work.”

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