REMOVAL OF FEDERAL INCOME TAX DEDUCTION FROM STATE CORPORATE INCOME TAX CALCULATION, AMENDMENT 3, would amend the Pelican State’s constitution to prohibit using federal taxes paid to reduce state corporate taxes. Louisiana is one of only a few states that allows state deductibility for federal taxes paid. This measure would help simplify the tax code; however, on its own it would increase taxes paid by Louisiana businesses. At the same time, the Louisiana State Legislature passed legislation that would lower the state’s corporate income tax rate from a graduated 8 percent rate to a flat 6.5 percent rate, if Amendment 3 passes. The net fiscal impact is unclear.
PROPERTY TAX EXEMPTIONS FOR WIDOWED SPOUSES OF FIRST RESPONDERS AND MILITARY PERSONNEL, AMENDMENT 4, would allow surviving spouses of first responders and members of the military killed while performing their duties to receive an exemption from ad valorem property tax for the value of their homestead.
TRANSPORTATION FUND AND REVENUE ALLOCATION, AMENDMENT 5, would, if enacted, establish a trust fund to be used for transportation and other infrastructure projects. If passed, taxpayers should be vigilant in ensuring these resources are properly used and do not become “slush funds” to support overspending or pay for non-essential items.
USE OF RESTRICTED FUNDS TO ELIMINATE FUTURE DEFICITS UPON PROJECTED REVENUE REDUCTION, AMENDMENT 6, would allow the state government to use up to five percent of the current fiscal year’s appropriations – or up to one percent of the current year’s constitutionally established funds – to eliminate projected deficits the following fiscal year. Over the last decade, the Pelican State has been an example of fiscal folly. At the same time, the decline in oil prices has caused problems for the state’s budget. This measure would help smooth out serious variations in revenues, but it should not be used to continue to prop up an otherwise unsustainable and bloated state government.