(Constitutional Amendment) Provides for the rates and brackets for purposes of calculating income taxes and eliminates the mandatory income tax deduction for federal income taxes paid for purposes of computing income taxes
Impact
If passed, HB 206 would significantly alter how Louisiana sets its income tax rates and manages deductions for federal income taxes. By giving the legislature more power to adjust tax brackets, the state could pursue a more flexible approach to tax policy that could respond to changing economic circumstances. However, the elimination of the federal tax deduction might lead to higher effective tax rates for individuals and could impact overall tax revenue and budgets in the state.
Summary
House Bill 206 is a proposed constitutional amendment that seeks to modify the framework for state income taxes in Louisiana. Specifically, the bill aims to eliminate the existing restrictions on the maximum rates and brackets for income taxes, which have been set at pre-defined limits since January 1, 2003. Instead, it proposes that these tax rates and brackets should be determined and amended through legislative actions rather than being anchored in the state constitution. Moreover, HB 206 would remove the mandatory deduction of federal income tax payments when calculating state income taxes, potentially affecting taxpayers' overall tax liabilities.
Sentiment
The reception of HB 206 has been mixed among legislators and the public. Proponents argue that the bill simplifies tax administration and allows for more responsive governance concerning tax policies, aligning with changing economic needs. Conversely, opponents express concerns that removing the federal deduction could disproportionately affect middle- and lower-income taxpayers, increasing their tax burden. This concern highlights a fundamental tension between the desire for flexible tax policy and the need to safeguard taxpayer interests.
Contention
Notably, the proposed amendment would require voter approval in a statewide election scheduled for November 8, 2022. This aspect of the bill adds another layer of complexity to the debate, as the electorate's stance on income tax matters can be volatile and influenced by broader economic conditions. The inclusion of a referendum could heighten public awareness and engagement with tax policy discussions, potentially leading to competing narratives around the benefits of increased legislative control versus the rights of taxpayers to maintain certain deductions.
(Constitutional Amendment) Provides for the rates and brackets for purposes of calculating income taxes and eliminates the mandatory deduction for federal income taxes paid for purposes of computing income taxes (EG SEE FISC NOTE GF RV See Note)
(Constitutional Amendment) Provides for the rates and brackets for purposes of calculating income taxes and limits the mandatory deduction for federal income taxes paid to corporate income taxes (RE1 SEE FISC NOTE GF RV See Note)
(Constitutional Amendment) Provides for the rates and brackets for purposes of calculating income taxes and repeals the deduction for federal income taxes paid for purposes of computing individual and corporate income taxes (EG NO IMPACT GF RV See Note)
(Constitutional Amendment) Provides for a flat tax on individual income and eliminates the mandatory income tax deduction for federal income taxes paid for purposes of computing income taxes (RE SEE FISC NOTE GF RV See Note)
(Constitutional Amendment) Eliminates the income tax deduction for federal income taxes paid for purposes of computing individual income taxes and the references to the maximum amount of individual income tax rates and brackets (EG SEE FISC NOTE See Note)
(Constitutional Amendment) Provides for the rates and brackets for purposes of calculating individual income tax and the deduction for federal income taxes paid when calculating income tax liability (OR SEE FISC NOTE GF RV See Note)
(Constitutional Amendment) Eliminates the deduction for federal income taxes paid for purposes of computing individual income taxes (OR SEE FISC NOTE See Note)
(Constitutional Amendment) Provides for a flat tax on individual income and eliminates the income tax deduction for federal income taxes paid for purposes of computing individual income taxes (OR SEE FISC NOTE See Note)
(Constitutional Amendment) Establishes the maximum rate for purposes of calculating individual income taxes and repeals the mandatory deduction for federal income taxes paid (OR SEE FISC NOTE GF RV See Note)
(Constitutional Amendment) Eliminates the income tax deduction for federal income taxes paid for purposes of calculating corporate income tax liability
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.