Five weeks into the 2021 Regular Session, two key 1A priorities, centralized sales tax collection and the M.J. Foster Promise Program, continue to move forward. This week, as the Senate Revenue & Fiscal Affairs Committee takes up the state budget, 1A will join the Ready Louisiana Coalition for Early Ed Day to advocate for investing in early care and education.
Here is an update on the activities and legislation 1A is engaged on and monitoring:
Centralized Sales Tax Collection
HB 199 by Speaker Clay Schexnayder – This Constitutional Amendment establishes the State and Local Streamlined Sales and Use Tax Commission to modernize and simplify our tax system for Louisiana’s small businesses. This new 8-member Commission will have equal representation from state and local governments and will administer sales tax collection, auditing, and dispute resolution. This common-sense reform puts Louisiana’s businesses on a level playing field with online retailers like Amazon and Wayfair. HB 199 passed the Senate unanimously with amendments, and the bill is scheduled for House concurrence of the Senate amendments on Monday, 5/17.
Several tax reform measures authored by Senate Revenue & Fiscal Affairs Chairman Bret Allain have cleared both the full Senate and the House Ways & Means Committee.
SB 157 by Sen. Bret Allain – This measure exempts nonresident mobile workers who work in the state for fewer than 30 days from individual income tax and their employers from withholding tax. This change was recommended by both the Multistate Tax Commission (MTC) and the Council on State Taxation (COST). The bill is pending House final passage.
SB 159 by Sen. Bret Allain – This Constitutional Amendment reduces the maximum rate of individual income tax from 6% to 4.75%, as amended, and it removes the mandate for a deduction for federal income taxes paid. SB 159 is pending consideration in the House Civil Law and Procedure Committee on Monday, 5/17.
SB 160 by Sen. Bret Allain – This good-government bill simplifies tax administration for businesses by aligning state partnership reporting adjustments to federal taxable income with current federal partnership audit adjustments. It is pending House final passage.
SB 161 by Sen Bret Allain – This legislation aids small businesses by extending, through 2025, the exemption from the corporate franchise tax on the first $300,000 of a small business corporation’s taxable capital. It is pending House final passage.
Unemployment Compensation Trust Fund
Last week, the House approved HB 642, Speaker Clay Schexnayder’s plan for spending the first tranche of Louisiana’s federal American Rescue Plan Act funds. Following Governor Edwards’ recommendation, the bill directs $400 million to replenish the state’s depleted Unemployment Compensation Trust Fund (UC Trust Fund) and ensure business taxes and worker benefits will remain at their current levels.
Legislators have been working to provide stability for businesses as officials plan for solutions to shore up the UC Trust Fund:
SB 89, SCR 3, and SCR 5 by Sen. Mike Reese would ensure that both UC tax rates for businesses and benefit levels for recipients would remain the same for the next year. These measures unanimously passed the full Senate and the House Labor and Industrial Relations Committee and are now pending House consideration.
Early Ed Day at the Capitol
This week, the Senate Finance Committee will begin its consideration of the proposed $36 billion state budget, HB 1 by Rep. Jerome Zeringue. As part of the Ready Louisiana Coalition – a bipartisan, statewide coalition to invest in quality, affordable early care and education – 1A reached out to Senate Finance Committee members to encourage them to invest in early care and education (#InvestInECE).
Early care and education stakeholders will hold a press conference at the Capitol this Tuesday for Early Ed Day at the Capitol.
SB 148 by Sen. Page Cortez – This bill creates the M.J. Foster Promise Program, a key priority of 1A’s 55 by 25 educational attainment initiative.Beginning in 2022, The M.J. Foster Promise Program would provide financial support for Louisiana adults to earn credentials that align with high-demand jobs in industries like construction, healthcare, information technology, manufacturing, and more. The program will serve as a “last dollar” award, open to Louisiana residents over the age of 21. SB 148 was reported favorably out of the House Education Committee with amendments and is now pending House consideration, following review by the Legislative Bureau.
HB 459 by Rep. Barbara Freiberg – This bill would require the Louisiana Workforce Commission (LWC) to report certain occupational and employment information to the Board of Regents for economic research and occupational forecasting. These statistics will enable data-based decision making to ensure Louisiana’s educational programs are meeting our current and future workforce needs. HB 459 passed the House by a vote of 87-9 last week and is now pending Senate introduction.
1A continues to monitor key transportation funding measures, including:
HB 582 by Rep. Jack McFarland – This bill would transfer $120 million of the avails of the existing state gas tax into the Construction Subfund of the Transportation Trust Fund (TTF), ensuring those funds are protected for project delivery, construction, and maintenance. The legislation also includes a one-time road user fee of $1,000 on electric vehicles and $500 on hybrids. HB 582 was reported favorably out of the House Ways & Means Committee and is scheduled to be considered by the House Appropriations Committee on Monday, 5/17.
HB 40 by Rep. Mark Wright – This bill prevents DOTD from using TTF dollars to pay for employee salaries and pensions by gradually removing those funds from DOTD’s operating budget beginning in FY 2022-2023. The bill was reported favorably by the House Appropriations Committee last week and is scheduled to be considered on the House floor on Tuesday, 5/18.