Report: Jindal tax reform proposal equates to increase for bottom 80%

A report released by The Institute on Taxation and Economic Policy, which calls itself nonpartisan but is often referred to as left-leaning, says that Gov. Bobby Jindal’s proposal to eliminate personal and corporate income taxes would lead to a tax increase for the bottom 80% of Louisianans. The report says Louisiana collected nearly $3 billion in revenues from its personal and corporate income taxes last year. Offsetting that lost revenue with increased sales taxes and the elimination of certain exemptions would also lead to an annual average tax increase of $395 for the state’s poorest 20% of taxpayers: that is, those with an average income of $12,000. That’s a 3.4% increase. Meanwhile, the report says the state’s top 1% of earners—those with annual incomes of $1 million or more—stand to see a tax cut of about $25,423 each year under the plan. Tim Barfield, head of the Department of Revenue, has said the administration hopes to mitigate the impact on the poor and working-class people by protecting tax exemptions on necessities, such as food for home consumption, prescription drugs and residential utilities. He suggests that, while lower-income people would lose the state’s earned income tax credit, a similar benefit could be delivered to people who receive that credit, possibly through a rebate. You can see the full report here; and take a look at other local and national reactions to Jindal’s proposal here.