The four major announced candidates for governor of Louisiana agreed today on the need to scrutinize the state’s incentive programs, streamline sales tax collection and make it easier to cut spending categories currently protected by the state constitution.
Public Service Commissioner Scott Angelle, Lt. Gov. Jay Dardenne, State Rep. John Bel Edwards and U.S. Sen. David Vitter spoke at a luncheon hosted by the Louisiana chapter of the National Federation of Independent Businesses, the Louisiana Restaurant Association and the Louisiana Retailers Association. Edwards is a Democrat, while the other three officials are Republicans.
Vitter reiterated his intention to hold a special session to pass “fundamental spending and tax reform.” He described Gov. Bobby Jindal’s proposal to scale back the state’s inventory tax credit, which offsets inventory taxes paid by businesses at the local level, as a “huge tax increase” on business. He said he supports getting rid of the inventory tax altogether but said local governments need to be able to replace the revenue. The Jindal administration has reportedly expressed a willingness to repeal the tax.
“We need to look at every state tax credit, incentive and deduction,” and decide which ones provide a viable return on investment, Vitter said. Whether the credits are refundable or not shouldn’t matter, he says, taking one of several swipes from the candidates at Jindal’s Grover Norquist-approved approach to tax and spending policy.
Dardenne similarly said the inventory tax should be eliminated in consultation with local governments that depend on the revenue. He said he expects the next governor—whoever it is—will call for a fiscal reform session early on and that the state should consider reducing tax rates while eliminating exemptions.
“The best way to gauge a person’s future conduct and behavior is to look at their conduct in the past,” Dardenne said. “I want you to be able to say, ‘I’m proud that Jay Dardenne is our governor.’”
Angelle touted his experience running a small business and serving in several capacities in state government. He said every proposed new state regulation of business should be accompanied by a “justification statement” that takes into account existing regulations on that industry. He also called for an “exemption review conference” similar to the existing Revenue Estimating Conference.
“We’ve gone from fire drill to fire drill to fire drill,” Angelle said, referring to yearly efforts to balance the budget. “Now ladies and gentlemen, the building is on fire.”
Edwards took the opportunity to make one of the afternoon’s few explicit jabs at another candidate.
“It is true; the building is on fire. But I didn’t spend several years helping Bobby Jindal light the match,” Edwards said, referring to the fact that Angelle has been a Jindal ally in the past and was appointed as temporary lieutenant governor by Jindal in 2010.
Edwards touted his personal story, which includes graduating from the U.S. Military Academy at West Point and serving eight years in the Army as an airborne ranger. He was the only candidate not to rule out the idea of establishing a state minimum wage higher than the federal rate, but he said it was really Congress’ responsibility to raise the minimum wage so as not to create an uneven playing field among states.
All the candidates said sales tax collection needs to be streamlined. Candidates noted that Louisiana would need a single collector to take advantage of Internet sales taxes if Congress decided to enforce collection of those taxes.
Pat Felder, the owner of Felder’s Collision Parts who sits on the leadership council of the NFIB, says small business always gets plenty of lip service from politicians, but that often times it never comes to fruition once the election is over.
“Hopefully (today and in the campaign) we’ll be able to have some proper conversations about the budget and fiscal responsibility,” she says. “We’ve talked about incentives, but there are some 330,000 small businesses in this state. If there was any sort of incentive for small business—even if each one only added a single job—that would be 330,000 jobs created in the state. So we’d like to see something like that.”
—David Jacobs
