Forbes: Bobby Jindal’s Tax Plan Is A ‘Posterize’ Slam Dunk Over Texas Governor Perry
During this year’s March Madness across state legislatures, governors are competing for bold new ways to grow their job base. This week, Louisiana Governor Bobby Jindal detailed a jobs strategy that could take the Pelican State into the Final Four of tax competition.
Jindal’s tax bracketology is simple and clear to all businesses — a flat, fair, and simpler tax code is the better choice for moving Louisiana forward in economic growth. Jindal’s plan is far-reaching and intrepid — no state income tax, no corporate income tax, and no corporate franchise tax. Zero. Zilch. Nada. In exchange, the state that lost $6 billion in adjusted gross income since 1995 would modernize its sales tax system to replace nearly $3 billion in state revenues. With lower property tax burdens than the Lone Star State in the Bayou, the loudest opponent to this plan should be Texas Governor Rick Perry.
By lowering the penalty Louisiana currently extracts from workers, nearly 400,000 small businesses with fewer than five employees would get a clear economic signal from their Louisiana Department of Revenue. The more you produce, the more you can reinvest in a much friendlier business environment. If Washington, D.C., or Tea Party groups were looking for a game-changing state initiative, Baton Rouge just became fair tax headquarters.
Of course what comes next in their State Capitol is a boatload of special interest lobbyists, legislative conflicts, and legal hurdles. As this forward-thinking vision for revenue-generating policy enters the sausage grinder in the coming weeks, it will be vital for butchers and carpenters to understand this opportunity.
Most states have sales tax bases that miss two out of every three free throws. Two-thirds of all eligible transactions in state economies (services, exempt products) are not taxed. Some sales tax exemptions already provide relief to our most vulnerable citizens for good reason. However, over time, state sales tax codes usually are slapped with flagrant fouls from special interests. It is appropriate that governors like Jindal call a time-out for the ordinary taxpayer versus those with inside influence.
When consumers can choose how to balance their taxes through consumption, families have the power to make purchasing decisions that are better for their families.
When local governments begin to capture revenues from online sales, elected officials and city leaders will need to sort out how best to structure and deliver services, and how to do away with century-old tax loopholes.
How big is Jindal’s full court press for lower tax burdens? Big enough to make the Tax Foundation rescore Louisiana’s tax code ranking from 32nd to the top four across America if passed. If Jindal slam-dunks this tax reform to advance his state’s tax policy past recent legislative votes in Kansas,Missouri, and Oklahoma, his economic team could become the top seed in the fast-break run for jobs.