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Wednesday, November 14, 2018



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Sales tax bill fails as Louisiana session edges to collapse

Sales tax bill fails as Louisiana session edges to collapse

BATON ROUGE, La. (AP) — With only days remaining in Louisiana's special session, House lawmakers Wednesday voted down a sales tax bill that was the favored approach of Republican leaders, continuing the disarray that has defined the session and throwing the ability to reach a budget fix into serious doubt.

Gov. John Bel Edwards said he and the Legislature were in a 24-hour period that was "critical as to whether we can succeed" in the session that must end March 7. The House vote seemed to tilt further against the likelihood of reaching a deal to close a $994 million budget hole that looms July 1.

Frustration was evident among lawmakers.

"The people of Louisiana are better than what we are delivering, because so far we have delivered nothing," said Rep. Rob Shadoin, a Republican from Ruston.

With the failure of the sales tax bill , the House adjourned without action on any income tax bills favored by Democrats, scheduled to return Thursday. But time is running short.

The shortfall that hits in four months is caused by expiring temporary taxes. Edwards wants lawmakers to pass replacement taxes, saying without them, the TOPS free college tuition program, health care services and public safety programs would face deep cuts. Edwards said the cuts "would be horrendous."

"I feel no sense of urgency from anyone," said Rep. Tanner Magee, a Houma Republican.

Failing to get enough support Wednesday was a measure that would temporarily renew one-quarter of an expiring 1 percent sales tax and temporarily eliminate some sales tax breaks, to raise nearly $300 million annually. Louisiana's current state sales tax rate is 5 percent. It drops to 4 percent on July 1. The bill by Rep. Stephen Dwight, a Lake Charles Republican, would move the rate to 4.25 percent. But 0.25 percent of the tax would again be temporary, with an expiration date in mid-2021.

"Is it perfect? Probably not. But it's a solution," Dwight said. "I did not want a billion dollars in cuts."

Only 38 of 105 House members voted for the measure. It needed 70 votes to pass.

The sales tax proposal is backed by House GOP leaders, but opposed by some anti-tax Republicans and by some Democrats who say it's a heavier hit to the poor.

"The poor people of this state are suffering, absolutely suffering," said Rep. Gary Carter, a New Orleans Democrat. "This is an easy no vote."

In a speech to a local Rotary Club, Edwards suggested lawmakers needed to be more willing to consider compromise.

"If you insist on what in your mind is perfect before you will vote on it, then what you are insisting on is failure," Edwards said, comparing the stalemate to congressional inaction in Washington. "The people of Louisiana deserve better than that."

Part of the $994 million shortfall will be offset with $302 million estimated from increased state income-tax collections caused by the federal tax changes. Edwards said that $692 million in replacement taxes should be "imminently doable."

House lawmakers did vote for a proposal to improve Louisiana's spending transparency website, sending it to the Senate for debate. But they rebuffed House Speaker Taylor Barras' constitutional change to rewrite the state's spending cap formula, an effort aimed at limiting annual spending growth.

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Follow Melinda Deslatte on Twitter at http://twitter.com/melindadeslatte