Louisiana Sen. Ben Nevers, D-Bogalusa, said Monday he would support a temporary reinstatement of state income tax hikes that were repealed in 2008 if it would avoid severe budget cuts for higher education.
Speaking to the Press Club of Baton Rouge, Nevers said the state is facing a serious problem if it cannot adequately fund higher education.
“The dismantling of higher education will become the coffin to bury Louisiana in for decades to come,” he said.
The state has cut funding for higher education by $280 million over the past two years due to declining tax revenues, Nevers said.
He noted that another $290 million of federal stimulus funds now supporting higher education in Louisiana won’t be available for the fiscal 2012 budget.
Nevers suggested reinstating the Stelly tax plan, approved by voters in 2002, which raised state income tax rates while lowering the sales tax on groceries.
The plan, named for Victor Stelly, the former Republican state senator who sponsored the original legislation, raised the state income tax rate on individuals earning between $25,000 and $50,000 to 6% from 4%.
The 2008 Legislature repealed the plan and restored the 4% rate.
The revised rate is expected to reduce state revenue by $251 million in fiscal 2011, $262 million in fiscal 2012, and $273 million in fiscal 2013.