DALLAS – Louisiana House Speaker Chuck Kleckley abruptly canceled a hearing on Gov. Bobby Jindal’s sweeping changes to state tax policy until legislative budget experts analyze its fiscal impact.
House Ways and Means Committee members were notified Tuesday night that the Wednesday morning hearing had been canceled.
Hearings on the tax swap will not be rescheduled until the Legislative Fiscal Office can complete its review of Jindal’s 11-bill tax package, Kleckley said in a pre-session news briefing.
"There's no sense in moving something forward and having debate on something until we have accurate, hard, believable numbers,” he said.
There is too much uncertainty over Jindal’s plan to end the state income tax on Jan. 1 and offset those revenues with a higher, broader-based state sales tax, Kleckley said.
"There's so many confusing, so many conflicting stories on the numbers we think it's very, very important to get those numbers correct,” he said.
The increase in the sale tax was originally estimated at 5.88% from the current 4% by the administration. The projected rate was raised to 6.25% last week after questions were raised about the data used by the Department of Revenue.
The Legislature will convene Monday for a 60-day session. The legislative analysis is expected to be completed in two weeks.
"We'll sit back and wait for the LFO numbers,” Kleckley said. “We'll be comfortable with those numbers."
Jindal said he was not concerned about the delay.
“The session hasn’t started yet,” he said. “We’re in the process of working with legislators and the LFO to analyze the data and get on the same page.”
Jindal said the tax swap would generate the same revenues as before, and that he would veto any legislation that was not revenue neutral.
Ending the income tax is a popular idea, Kleckley said, but lawmakers are divided on how to make up the loss of up to $3.6 billion of annual revenue from the personal and corporate income taxes.
Estimates by the Department of Revenue that the shift will increase business taxes by $500 million a year are disturbing, Kleckley said.
"If it's going to have an impact on small business or any business for that matter, it's going to be hard for me to support," Kleckley said.
The budget bill analysis will focus on how the changes will affect taxpayers and businesses, Kleckley said, and whether the plan is actually revenue neutral.
“I want to see the Legislative Fiscal Office’s numbers before deciding where we’re going,” he said. “Until we get those numbers we’re going to go ahead and move forward with member’s bills and start hearing member’s legislation next week.”
Rep. Joel Robideaux, chairman of the Ways and Means Committee, said earlier this week he was concerned about the conflicting estimates of the tax swap.
"I'm not going to say its revenue neutral until I see the numbers from the Fiscal Office," he told the Press Club of Baton Rouge on April 1.