(The Center Square) — On Friday, Gov. Jeff Landry’s proposal to amend Article 7 of the Louisiana Constitution was heard by the Ways & Means committee.
The committee voted to move forward favorably with House Bill 7.
House Bill 7, introduced by Rep. Julie Emerson, R-Lafayette, makes major changes to how the Legislature is able to levy tax exemptions, credits, rebates and other programs.
Specifically, enacting new exemptions, exclusions, deductions, credits, or rebates or increasing their dollar amounts will now require a two-thirds vote in the House and Senate.
Further, beginning in 2026, any new tax exemption, credit, or rebate will only be approved if it applies to both state and local sales taxes.
For example, if lawmakers propose a tax exemption for school supplies, that exemption would need to cover not just the state sales tax but also the local sales taxes collected by cities and parishes.
“That is why our tax code is so complicated, is because we’ve done that over and over again for a very long time,” Richard Nelson, secretary of the Department of Revenue, said. “So, in Orleans Parish, coffee might be taxed. But in Plaquemines parish, it’s not in some cases, and then the state doesn’t tax it too. One of the most frequent complaints for every business and for the administration of the sales tax code, is that the bases are not unified.”
The bill also exempts sales taxes for prescription drugs, doubles the standard deduction for seniors, adds money to the budget stabilization fund and phases out the revenue stabilization fund.
The bill will also provide teachers with a permanent pay raise of $2,000, instead of the annual stipend they currently receive.
The bill was not without opposition. Jim Patterson, the president of the Louisiana Association of Builders and Industry, worried that the new language in the bill will overly restrict the state’s capacity to provide tax relief.
“The Louisiana Association for Business and Industry has for a long time held the position that it ought to be difficult to raise taxes on the taxpayers, and it ought to be as easy as possible to relieve them,” Patterson said.
