Eliminates the deductibility of federal income taxes paid for purposes of calculating state individual income tax liability (EG SEE FISC NOTE GF RV)
Impact
The bill's impact is noteworthy as it shifts the tax responsibility towards individuals and entities who may have relied on the federal tax deduction to mitigate their state tax liabilities. This change is expected to affect the overall amount of revenue generated for the state, potentially leading to increased state funding but also raising concerns among taxpayers about their overall tax burden. The legislation specifies that the changes apply to taxable periods starting on January 1, 2018, contingent upon certain other legislative measures being enacted.
Summary
House Bill 358 focuses on amending Louisiana state tax laws by eliminating the deductibility of federal income taxes when calculating individual income tax liabilities. This significant shift in the tax framework is intended to adjust how state tax obligations are computed, affecting both individuals and corporations operating within Louisiana. By repealing the state provisions that allowed taxpayers to deduct federal taxes paid, the bill aims to align state income tax calculations more closely with federal guidelines while expanding the tax base for the state treasury.
Sentiment
Sentiment around the bill appears to be mixed, with some stakeholders arguing that the removal of deductibility is a necessary step towards simplifying and streamlining the tax code. Advocates believe this change could lead to a fairer taxation system. Conversely, opponents of the bill express concern that it may disproportionately affect lower and middle-income taxpayers who may find themselves paying higher taxes as a result. The discussion reflects broader debates within tax policy regarding equity and efficiency.
Contention
A notable point of contention regards how the repeal of the federal income tax deduction could lead to differing impacts among population segments. While proponents argue it will lead to a more robust tax system, critics warn it could impose additional financial strain on residents and potentially deter economic growth. Additionally, the bill's passage relies on several other amendments being approved, creating further uncertainty and debate among legislators and constituents alike.
Repeals the state income tax deduction for federal income taxes paid for purposes of calculating individual and corporate income taxes (Item #17) (RE1 SEE FISC NOTE GF RV See Note)
Repeals the state income tax deduction for federal income taxes paid for purposes of calculating individual and corporate income taxes (Item #40) (EG SEE FISC NOTE GF RV See Note)
Repeals the state income tax deduction for federal income taxes paid for purposes of calculating individual and corporate income taxes (Item #17) (OR +$374,000,000 GF RV See Note)
Repeals the state income tax deduction for federal income taxes paid for purposes of calculating corporate income taxes (Item #17) (EG +$22,000,000 GF RV See Note)
Requests that the Bd. of Regents and the State Bd. of Elementary and Secondary Education, with the Taylor Foundation, La. Office of Student Financial Assistance, public postsecondary education management boards, and certain others, study certain issues relative to TOPS
Requests the Louisiana Workforce Commission and the Louisiana Department of Veterans Affairs to study employment practices and professional licensing requirements to benefit veterans in the workforce
Creates a task force to study meaningful oversight of the professional healthcare licensing boards statutorily created within the Department of Health and Hospitals.