Jindal’s tax proposal actually a tax increase for most Louisianans

By Eric W. Dolan
Tuesday, January 15, 2013 19:28 EDT
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Louisiana Governor Bobby Jindal (R), image via Wikimedia, Creative Commons licensed.
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Gov. Bobby Jindal’s (R) proposal to eliminate income and corporate taxes would amount to a tax hike for most Louisianans, hitting those of lower income particularly hard, according to a liberal think tank.

Jindal plans to keep his tax proposal revenue-neutral by increasing the state’s sales taxes to compensate for the cuts. The sales tax could possibly jump up to 7 percent to make up for the $2.9 billion that would be lost from state income and corporate taxes.

According to the Institute on Taxation and Economic Policy, Jindal’s tax proposal would end up cutting taxes for the wealthiest Louisianans while raising taxes on the bottom 80 percent of Louisianans.

The poorest 20 percent of taxpayers would see an average tax increase of 3.4 percent and the middle 20 percent would see an average tax increase of 1.2 percent. Meanwhile, the top one percent of Louisianans would see an average tax cut of 2.3 percent, or $25,423.

“The ITEP analysis does not include any low income tax relief because the mechanism for that relief is unclear at this time,” the organization said. “However, it is worth noting that any low income tax relief will likely be insufficient to off set the impact of the large sales tax hike necessary to make this tax swap revenue neutral.”

[Image via Gage Skidmore, Creative Commons licensed]

Eric W. Dolan
Eric W. Dolan
Eric W. Dolan has served as an editor for Raw Story since August 2010, and is based out of Sacramento, California. He grew up in the suburbs of Chicago and received a Bachelor of Science from Bradley University. Eric is also the publisher and editor of PsyPost. You can follow him on Twitter @ewdolan.
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