Now that tax reforms passed by lawmakers a few years ago have kicked in, Louisiana now has the 6th-lowest state income tax rate in the country. That data comes from a new report by the Tax Foundation. Baton Rouge tax attorney and consultant Jason DeCuir says our state was among the highest (6-percent) until recently…:
“This is really related to the 2021 tax reforms that the Legislature took on. This is drastic improvement from where we have been.”
DeCuir says the 2021 Legislature passed a so-called tax swap reform package, which removed taxpayers’ ability to deduct their annual federal taxes paid…:
“…but in exchange, we lowered our rates, and we went from 6-percent to now a top marginal rate of 4.25-percent.”
DeCuir says lowering the state tax burden will almost certainly help Louisiana with future economic development…:
“when people are looking to come to your state, or companies are looking to invest in your state…they look at that top sticker rate and we had one of the highest.”
Despite the now lower tax rates, Louisiana is still on track to collect about 40-percent of its annual revenue from income taxes and other declaration and withholding taxes. Legislative efforts are expected this spring to end state income tax altogether.
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