Louisiana government is looking at its first budget deficit in several years. The deficit for next fiscal year is the result of a temporary state sales tax of .45-percent expiring as well as a two-percent tax on business utilities. House Appropriations Chairman Jack McFarland says much needed reforms are needed to address this upcoming shortfall.
“So now is a great time for us to take, as a legislature, a holistic approach to addressing our tax structure, and our budget expenditures,” McFarland said.
Currently, Louisiana is facing a projected revenue shortfall of 340-million dollars for next fiscal year. McFarland says that does not include the 248-million dollars in education initiatives that pays for teacher stipends and student tutoring, approved by the legislature in the spring. McFarland says House Appropriations will hold several hearings over the next few months to discuss the shortfall.
“Where can we streamline services? What efficiencies can we make within our own agencies? If reductions are necessary, what are they? What would they look like? What programs, what services will be affected?” McFarland asked.
McFarland says the responsible thing for the legislature to do is finally address tax policies that are antiquated. He says the timing is perfect, because this is an issue legislative leaders are committed to tackling.
“Now is the time to begin to have those conversations, so should we have an opportunity to address this before the regular session, I think it would be advantageous,” McFarland said.
The regular legislative session begins April 14th, but a special session on tax reform before that is possible.
