Governor Jeff Landry’s Economic Development and Fiscal Policy Council recommends the state phase out corporate and personal income taxes

Governor Jeff Landry’s Economic Development and Fiscal Policy Council has recommended the state should begin the process of phasing out corporate and personal income taxes. Louisiana Department of Revenue Secretary Richard Nelson, who lobbied for this as a lawmaker, says this is music to his ears.

“I thing Governor Landry has made it clear that he wants us to take a look at everything. Everything’s on the table to try and make Louisiana better. I think tax policy and big tax changes are one of those – one eliminate in that puzzle.”

Louisiana’s corporate and personal income tax currently brings in nearly $5 billion a year that supports health care, higher education, public safety and other programs in every community in the state. While the state’s total tax burden is competitive with our neighbors, our tax structure is not, ranking 40^th in the latest Tax Foundation ranks.

The former state representative from Mandeville says Louisiana’s tax code is outdated, complex, and keeps the Bayou State from reaching its full economic potential. When asked what his solutions are to offset the lost revenue to the state treasury…

“Generally broadening the base of some of our existing taxes to lower the rate is probably the best way to do it. And some of the taxes that are really not competitive with other states, I think those are the ones we look at to get rid of.”

Another recommended solution is to reduce the severance tax rate using a multiyear phasedown approach. Texas and Florida are only two of nine states in the nation where residents and business owners do not have to pay state income tax on money earned.

With a GOP super-majority in the legislature, Nelson hopes the proposed new tax structure brings even more momentum. But he says it will not be a quick process to end this trend and join other state in economic prosperity.

“All of these changes, no matter what we do will be phased in over time so we give people and tax payers a chance to adjust. It’s not going to happen overnight.”

This tax policy will not be addressed by lawmakers until the fiscal regular session in 2025.