Amendment to make sales tax permanent advances

Local News

BATON ROUGE, La. (BRPROUD) – What started as a bill to regulate taxes on smokable medical marijuana has turned into a major tax overhaul. An amendment added to the bill looks to make the temporary sales tax passed in 2018 permanent.

The bill by Representative Tanner Magee, while on the Senate floor, had an amendment added that looks to tackle the .45% sales tax set to expire in 2025. The tax was only supposed to be temporary but this amendment would make it permanent to put the money towards roads and bridges projects.

The sales tax was implemented in 2018 to deal with the state deficit and avoid education cuts. With the sunset approaching in 2025, Senate Republicans are looking to redirect the funds. The amendment by Senator Rick Ward proposes the nearly $400 million made annually would go from the general fund to a sub-fund solely focused on infrastructure construction.

“We’ve got to do something, we’ve got to make a move. In 10 years of being here, this is the most sensible thing and really the best opportunity we’ve had to try and address our infrastructure issues,” Sen. Ward said.

Senate President Page Cortez supports the extension, with many other Republicans saying something needs to be done about the $15 billion backlog of road and bridge projects in the state.

“I’ve had bridges collapse, and we’ve all had them in our districts, and what happens? They sit for a year and they just detour traffic because we don’t have the means with which to fix them,” Sen. Cortez said.

The Legislative Conservative Caucus came out against the bill. With 41 members, it could have an impact on if the bill can get a two-thirds vote to pass the house. Those against the bill are upset about extending a tax that was promised as a temporary measure. Some said sales taxes fall harder on lower-income residents and Louisiana has one of the highest combined state and local sales tax rates. 

While the money would not be made available to the construction projects until 2025, projects will be able to set bonds to get to work sooner with the projected revenue from the tax.

“Next term I may not be here, you may not be here and the legislators may say we need to lower this sales tax or we need to take this sales tax and fix a budget problem with it. You would be tying their hands for that because it’s bonded out,” Sen. J. Cameron Henry said.

There has not been a clear plan of how the budget would be adjusted when the sales tax ends in 2025 but Senators said infrastructure needs to be addressed now. The bill passed out of the Senate Finance and will now go on to the House.

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