House Tax Bills Get Easy Passage From Senate Committee

BATON ROUGE (AP) — A package of House-approved tax bills estimated to raise $615 million for next year's budget sailed through its first stop in the Senate on Monday, as budget negotiations continue.

         Without objection, the Senate Revenue and Fiscal Affairs Committee advanced 11 bills to rework tax break programs, scale back state subsidies for businesses and raise the state cigarette tax by 32 cents per pack. Three bills would make an across-the-board cut of 20 percent for most of the state's tax breaks.

         The proposals — several of which face opposition from business groups — head next to the Senate budget committee for consideration. Lawmakers acknowledged they could face substantial changes as the budget haggling continues among legislative leaders.

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         "Though you see the posture of how the bills are leaving committee today, that does not mean that will be their final disposition," said Sen. J.P. Morrell, D-New Orleans, a member of the Revenue and Fiscal Affairs Committee.

         Under the budget to be considered Thursday by the full House, nearly all the money raised by the tax bills would be used to keep higher education from deep cuts in the fiscal year that begins July 1. The rest of the dollars would be plugged into health care programs, which still face sizable reductions next year.

         The bills advanced by the Senate committee Monday include the cigarette tax hike, which would raise the tax to the 68-cent rate charged by Mississippi; limits on the state solar tax credit; temporary suspension of a 1-cent sales tax exemption on business utilities; and a reduction on tax credits businesses can receive for paying local property taxes on inventory.

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         Other tax proposals that won committee backing aren't expected to raise dollars for next year's budget, but could increase revenue in future years. They include a $200 million cap on the film tax credits Louisiana certifies each year and changes to a tax break for horizontal oil and gas drilling that would lessen the exemption's value as oil and gas prices increase.

         The Louisiana Association of Business and Industry opposes five of the largest revenue-raising bills, calling them tax hikes that would fall on every industry sector across Louisiana. The organization also has questioned whether the proposals received the vote required for House passage.

         The film industry is seeking adjustments to the bill that affects its tax credit, saying the cap is too restrictive. The solar industry is asking for tweaks to the measure that impacts its tax break program. And supporters of the cigarette tax proposal want the rate to be pushed higher, to discourage smoking.

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         Meanwhile, several of the measures don't meet Gov. Bobby Jindal's parameters of what tax changes he's willing to consider. The Republican governor, who is building a likely presidential campaign, won't agree to anything considered a net tax increase by national anti-tax activist Grover Norquist. Lawmakers have been trying to find loopholes to Jindal's rules.

         – by AP Reporter Melinda Deslatte

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