Legislative Tax Summary + Free Webcast March 17
Friday, March 11, 2016
Posted by: Ann Lupo
Summary of Tax Legislation Passed in the
Special Session of the Louisiana Legislature
Thanks to LCPA Lobbyist Jim Harris, of Harris DeVille & Associates,, for providing the following summary of tax legislation passed in the special session. Additional Legislative Updates will be provided as needed. See note below to register for free legislative update webcast.
The First Extraordinary Session of the Louisiana Legislature ended March 9 at the 6PM deadline. The body was tasked with finding more than $900 million to shore up a deficit for the current year’s budget, which ends June 30, and more than $2 billion for the shortfall for next fiscal year. The Legislature passed nearly 70 pieces of legislation, and apparently fell short of their goal by $30 million for this fiscal year and $800 for next fiscal year. The numbers will be reconciled in the upcoming Regular Legislative Session, which begins Monday, March 14, by the Division of Administration as to what won’t be funded in the remainder of the current year and in the governor’s proposed executive budget for Fiscal Year 17, which begins July 1. This will likely result in additional cuts to healthcare and higher education, as tax legislation and revenue matters cannot be dealt with during this regular session. In these even-numbered years, Louisiana regular sessions are required to be "non-fiscal” in nature.
The current year’s budget deficit was addressed with approximately $160 million in spending reductions, the use of $400 million in one-time money (including from the Rainy Day Fund and $200 million from the BP settlement). Most of the new revenue $300 million this year and $1 billion annually came from the passage of a "clean fifth penny” of sales tax, which eliminated most existing exemptions and exclusions on that additional penny. In addition, a separate piece of legislation removed most exemptions and exclusions from the other four cents of state sales tax. All sales tax measures expire in 27 months – the three months remaining in this fiscal year and two years after. No measures passed to reduce the tax credit businesses receive for paying local property taxes on inventory.
In his press conference following the end of the session, Gov. John Bel Edwards said he "certainly [doesn’t] rule out” another special session after the end of the regular session, which must adjourn June 6. He was unhappy with the outcome of the session and the lack of coordination by the House and Senate, as was Senate President John Alario, who said, "That’s not the way to conduct the people’s business.
Free webcast exclusively for LCPA members and their staff!
Louisiana Legislative Tax Update
Thursday, March 17, 10:00-11:00a
Get an up-to-the-minute recap of the state and local tax legislation enacted during the 2016 special session, and learn how the changes may impact you and/or your businesses and clients.
Speakers: Bill Potter, Brandon Lagarde, and Gary Dressler
Register: Advanced registration is required. Register now!
Note: This webcast is being offered exclusively as an LCPA member benefit. It does not qualify for CPE. Group viewing is permitted.
Special thanks to all the LCPA members who assisted the Society in our advocacy efforts to protect the interests of CPAs and the clients/employers they serve.
Questions about the content of this Alert should be directed to Linda Babin.