(Constitutional Amendment) Eliminates the deduction for federal income taxes paid for purposes of computing individual income taxes (OR SEE FISC NOTE See Note)
Impact
The implications of HB 347 are significant, as it alters how individual income taxes are computed in Louisiana. By disallowing the subtraction of federal income taxes from state taxable income, tax liability for individuals is expected to increase. This change could particularly affect higher earners who pay substantial federal taxes. Supporters of the amendment argue that it may allow for more straightforward tax calculations and potentially lead to additional funding for state programs. Conversely, it may also burden taxpayers, particularly those who previously benefitted from the deduction.
Summary
House Bill 347 proposes a constitutional amendment to eliminate the deduction for federal income taxes paid when calculating individual income taxes in Louisiana. By removing this deduction, the bill aims to amend Article VII, Section 4(A) of the Louisiana Constitution. The change is intended to simplify the state's tax code and may lead to an increase in state revenue by broadening the tax base. The proposed amendment mandates its effectiveness starting January 1, 2018, and will be put to a vote among the electorate during the statewide election on October 14, 2017.
Sentiment
The sentiment surrounding HB 347 appears to be mixed. Proponents, often from fiscal conservative circles, advocate for the measure, arguing that eliminating such deductions will contribute to a more equitable tax system and increase state revenues. On the other hand, opponents, particularly those representing lower and middle-income taxpayers, express concerns that this could lead to greater financial strain on taxpayers who rely on such deductions to lessen their tax burden. This division highlights the broader debate around tax reform in Louisiana.
Contention
Key points of contention revolve around the fairness and economic impact of withdrawing federal income tax deductions. Critics argue that this constitutional amendment disproportionately affects lower-income individuals and may exacerbate fiscal challenges for many households. Furthermore, there are debates on whether the anticipated increase in state revenue would translate into tangible benefits for Louisiana's citizens, or if it would largely enhance state budgets with negligible direct effects on the constituents. This lack of consensus contributes to a polarized discussion regarding the potential benefits and drawbacks of HB 347.
Reduces the rate of the tax levied on the net income of individuals and increases the amount of the standard deduction for all filers (OR DECREASE GF RV See Note)
Reduces the rate of the individual income tax and authorizes an income tax deduction for taxpayers sixty-five years of age and older (RE -$377,900,000 GF RV See Note)
(Constitutional Amendment) To authorize local taxing authorities to enter into cooperative endeavor agreements for the purpose of payments in lieu of taxes (Item #28) (OR SEE FISC NOTE LF RV See Note)
Individual income and corporate franchise taxes; subtraction for global intangible low-taxed income established, corporate net operating loss deduction increased, and dividend received deduction increased.
Proposes temporary constitutional amendment allowing State constitutional convention convened to reform system of property taxation to propose statutory changes.
Proposes temporary constitutional amendment allowing State constitutional convention convened to reform system of property taxation to propose statutory changes.
(Constitutional Amendment) Provides for the election of constitutional convention delegates and vote requirements necessary for the adoption of a new constitution (RR SEE FISC NOTE GF EX)
(Constitutional Amendment) Modifies disposition of certain state revenues through repeal of the Revenue Stabilization Trust Fund and deposits of certain revenue streams into the Budget Stabilization Fund (RRF INCREASE GF RV See Note)
(Constitutional Amendment) Provides relative to the application of state monies to the unfunded accrued liability of the Teachers' Retirement System of La. (EN DECREASE SD RV See Note)
Proposing An Amendment To Article Xvii, Section 3 Of The Hawaii Constitution To Specify That The Standard For Voter Approval Of A Constitutional Amendment Proposed By The Legislature Is A Majority Of All The Votes Tallied Upon The Question.