Philosophical Differences on Display
Tax philosophies seem to be nearly as numerous as tax reform bills filed this session. As the House Ways and Means Committee took testimony on 20 measures dealing with corporate taxes Wednesday, those philosophies were on display.
Representative Barry Ivey (R-Baton Rouge) urged fairness as a guide, saying, “From a policy perspective, I believe we should treat all business the same.”
Representative Julie Stokes (R-Kenner) advocated using competitiveness as the measuring stick.
“You know, when you look at the tax structures in nearby states, Alabama is a flat corporate structure at 6.5; Arkansas is 6.5; Mississippi has a flat rate of 5; North Carolina has a flat rate of 4. And we’re sort of outliers at everything over $200-thousand being taxed at 8 percent.”
Stokes and Ivey are both pushing for the philosophy of revenue-neutrality with their tax reform packages, prompting Representative Walt Leger (D-New Orleans) to point out some areas truly need more funding.
“I can tell you another thing about those states,” Leger said, “They spend more money on higher education than we do.”
“I wonder what their outcomes are?” Stokes asked.
“Also better,” Leger replied.
Leger had just come from the committee room next door, where an Appropriations subcommittee was hearing about the unmet needs of Louisiana’s colleges and universities.
“Of 50 flagship institutions, we’re 46th in what we have to spend per student,” LSU System President F. King Alexander testified. “So we’re near the bottom, but we’re 26th in retention rate, and 24th in graduation rate.”
The Appropriations committee appears to be focused on an outcome-based budgeting philosophy. Addressing complaints that Louisiana had fallen to the bottom of the Southern Regional Education Board (SREB) rankings in state funding for higher education, Representative John Schroder (R-Covington) said colleges here need to improve their outcomes.
“If we want to be at a certain level of money, we should have that same graduation rate.”
Representative Beryl Amedee (R-Houma) took it further.
“Those graduation rates and some other factors are what we’re looking at. We’re looking for return on investment.”
So is the philosophy outcomes…or profitability?