Audit: La. tax breaks cut liabilities by $4.8B

Tax breaks to businesses and individuals in Louisiana cut state tax liabilities by $4.8 billion over six years, more heavily benefiting companies than people in the state, according to an audit released today. Businesses got tax cuts decreasing their tax liabilities by 55% from 2005 to 2010, compared with an 11% cut for individuals, says the review by Louisiana Legislative Auditor Daryl Purpera’s office. Louisiana has 464 tax credits and exemptions on the books, like breaks from tobacco taxes, gift taxes and severance taxes. The largest tax exemptions are given on the state’s business and personal income taxes, according to the audit. From 2005 to 2010, the latest tax data available from the state revenue department, businesses claimed $3 billion in corporate income and franchise taxes, out of a total tax liability of $5.4 billion, about a 55% reduction. Meanwhile, the audit says individuals took income tax breaks of $1.8 billion during the same period, out of a total tax liability of $16.5 billion, an 11% cut. In at least four types of tax credit programs, more than half of the tax credit went to only a handful of businesses, Purpera’s office notes. Read the full story from The Associated Press here, and check out the full audit here.