Tax raising advocates abound
by Sam Hanna, Jr. - posted Tuesday, May 26th, 2009 @ 4:55 pm

Not long after the ink dried on this offering last week a state Senate committee approved a measure that, in effect, represents a tax increase.

A bit ironic since it was suggested in this space a week ago that a movement would surface in the Senate to generate additional revenues to offset proposed budget cuts for higher education in Louisiana in the 2009-2010 fiscal year, which begins July 1.

The pro-tax movement in the Senate was expected in light of the House of Representatives' refusal to entertain a freeze on tax cuts approved by the Legislature last year. The effort to freeze tax cuts, which is a tax increase no matter how one attempts to spin it or explain it, is needed to pump more money into the state's colleges and universities. At least that's according to most higher education officials, their allies in the Legislature, at least two so-called good government watchdog groups and many members of the out-of-touch-with-reality media. They all are clamoring for a freeze on tax cuts, specifically the undoing of the Stelly Tax, to free up enough money to offset the $219 million in cuts for higher education that Gov. Bobby Jindal called for in his proposed budget for the new fiscal year.

Though the Senate Revenue and Fiscal Affairs Committee passed Senate Bill 335 by Sen. Lydia Jackson without objection, it is doubtful the bill stands a chance of being approved by the full Senate, much less the House. It's more than doubtful since Jindal pledged weeks ago to veto any legislation approved in the 2009 regular legislative session that would freeze any tax cuts lawmakers signed off on in 2008.

Jindal drew a line in the sand, so to speak. At the very least, we should say, hurrah for Jindal, who has exhibited as of late why conservatives coalesced behind his gubernatorial campaign in 2007.

Upon closer inspection, Jackson's bill—SB 335—is horrendous. It would take away a tax cut state income tax filers were scheduled to receive beginning in 2009, affecting state income taxes individuals would pay in May 2010. More specific, SB 335 would maintain excess itemized deductions at the 2008 level of 65 percent for the next four years. The deductions include mortgage interest expenses, medical expenses and charitable contributions. Under legislation approved last year, tax filers would be allowed to claim a 100 percent deduction for every penny spent on the aforementioned expenses and the like.

To surmise, Jackson's bill would punish individuals who pay mortgages, pay medical bills for themselves and their families and make contributions to their churches. A real winner, that SB 335.

Sad but not surprising, the higher education community supports Jackson's bill. In other words, the higher education community is in favor of punishing individuals who pay mortgages, pay medical bills for themselves and their families and make contributions to their churches.

While the Senate Revenue and Fiscal Affairs Committee was busy green lighting Jackson's tax hike bill, another one of those so-called do-gooder groups apparently was fine-tuning its edict calling on the Legislature to shelve the income tax cuts lawmakers approved in '08, or when the dreaded Stelly Tax was put out of its misery. Not only did the Council for a Better Louisiana (if you want to call it that) say the Legislature should go back on its word regarding Stelly, it said lawmakers should consider using one-time revenues, or non-recurring revenues, to thwart Jindal's proposed cuts for higher education. Furthermore, CABL says the Legislature should entertain tapping the state's "Rainy Day" trust fund to aid higher ed.

We'll have to assume CABL wasn't serious when it advocated—for years—that the Legislature implement reform-mind accounting measures when dealing with the state's operating budget. Those so-called reform-minded accounting measures included never using one-time revenues to pay for ongoing expenses such as expenditures for higher education. CABL was just poking fun, we have to assume.

Poking fun or not, when CABL unveiled its money grabbing proposal earlier this week for higher education it may have ruined its once stellar reputation as an organization that could be counted on to do what's in the best interest of the state. For now on, we will be left to wonder whether CABL will go back on its word when it comes under pressure to embrace a tax-raising agenda that would endear it to the so-called elite, or the higher education community.

Sam Hanna, Jr. is publisher of The Ouachita Citizen, and he serves in an editorial/management capacity with The Concordia Sentinel and The Franklin Sun, three newspapers owned and operated by the Hanna family. Hanna can be reached by calling (318) 805-8158 or by emailing him at samhannajr@samhannajr.com.