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Class warfare in Louisiana
The opposition to Gov. Bobby Jindal's proposal to abolish income taxes in Louisiana defies reason.
But we shouldn't be surprised that it surfaced since the bellyaching reared its head among the elitists in the bureaucratic crowd in Baton Rouge and secular Leftists in the media. And they all steadfastly believe government is the answer to all ills that plague society.
At the heart of the discussion — if you want to call it that – is Jindal's plan to raise the state sales tax by at least two cents in exchange for doing away with personal and corporate income taxes. All tax exemptions the business community currently enjoys would be on the table, too, and businesses will have to get involved in the mix to justify why their tax breaks matter.
All of it will be entertained by the Legislature during the regular session that begins in April. Mark your calendar.
Buoyed by robust economic activity throughout the state thanks largely to the oil and gas industry, Jindal obviously is trying to capitalize on it and give it a boost by putting more cash in the pockets of working people and businesses. After all, if Louisianians are given a pass on paying income taxes, they most likely will put that money to work in the economy because they'll spend more money in the economy. And that will lead to an increase in sales tax collections for the state.
So the theory goes.
Though Louisiana's personal income tax rates are relatively low, the fact of the matter is they're still taxes that are largely paid by the middle class and those who we would describe as well-to-do. But those state income taxes could be described as burdensome now in light of the $2 trillion in new taxes that President Obama and the Congress shoved down our throats Jan. 1 as part of the "compromise" to avoid the so-called "fiscal cliff." Don't forget about the $675 billion in news taxes the American people have begun to pay to help finance Obamacare.
On the other hand, the tax code for the business community in Louisiana is cumbersome and confusing. Ask any business owner. Steer clear of the elitists and secular Leftists because they simply don't understand how the business community operates. Trust me.
Yet, opponents of Jindal's proposal say it would unfairly shift the tax burden in Louisiana to the poor. They say that would be the case because poor people spend a larger percentage of their money on the bare necessities in life such as food and utilities and medicine. That Jindal's proposal would exempt food, prescription drugs and utilities from any increase in the state sales tax seems to have been overlooked. Also obviously overlooked was Jindal's idea to implement some sort of an expanded earned income tax credit to assist the working poor who currently don't pay any state income taxes to speak of but might get tagged by an increase in the state sales tax.
Simply put, Jindal's detractors either overlooked those details or they're opposed to the tax swap simply because Jindal proposed it. Take your pick.
There's no doubt that abolishing income taxes in Louisiana — personal and corporate — would set the state apart from the rest of the nation. Though other states such Florida, Tennessee and Texas don't levy income taxes, they are not Louisiana. We have an abundance of natural resources here, including oil and gas, we have the best food on the planet, we are home to the Sportsman's Paradise and our climate is appealing to older people who are eying retirement.
And Forbes magazine says Louisiana is the No. 1 state in the country for businesses.
Yet, Jindal's detractors say his tax swap proposal is a bad idea. And they have already taken a page from the Barack Obama handbook on politics by employing class warfare to shoot holes in it before we can engage in an open discussion of it merits. And its drawbacks.
What does that tell you?
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