[StBernard] IN CASE YOU MISSED IT: Jindal's Model For Tax Reform

[Westley Annis]

Jindal's Model For Tax Reform



Jindal's model for tax reform
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Reuters
By Grover G. Norquist & Patrick Gleason
March 14, 2013

With dueling budgets being introduced on Capitol Hill this week, the
possibility of tax reform is the talk of Washington. As we predicted before
last November's elections, tax reform will be on the agenda in 2013 - but
has its best chances in the states. We are seeing that demonstrated Thursday
by Louisiana's Republican governor, Bobby Jindal.

Jindal unveiled what could be, if approved by the legislature, the boldest,
most pro-growth state tax reform in U.S. history. His plan, outlined in
Baton Rouge this morning during a joint meeting of the House Ways and Means
Committee and the Senate Revenue and Fiscal Affairs Committee, calls for the
elimination of all state personal and corporate income taxes, as well as the
state franchise tax on capital stock. 

This would be replaced by an increase in the state sales tax rate to 5.88
percent, up from 4 percent. The sales tax would also apply to a broader base
of goods and a number of services previously untaxed.

Many governors around the country have proposed rate-reducing tax reform,
but Jindal's plan sets a gold standard for pro-growth reform. His proposal
could mean more disposable income for families while increasing the
job-creating capacity of employers across the Pelican State.

It would also make Louisiana's tax code more conducive to economic growth. 

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Louisiana ranked 32nd on the nonpartisan Tax Foundation's 2013 State
Business Tax Climate Index. If Jindal's plan is approved and signed into
law, the state will jump to No. 4 on that index.

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His plan adheres to the conservative principle that the tax code should not
be used to pick winners and losers in the economy. It demonstrates that the
purpose of real tax reform is to make the tax code more efficient and
competitive - not to raise additional revenue. Jindal's plan creates a
predominantly consumption-based tax system and does so in a way that he
estimates will raise the same amount of revenue for the state as current
law.

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