Now, About That Fiscal Cliff...

Jun 20, 2017

When will lawmakers be called back for the next special session to deal with the fiscal cliff?

“You know, that’s a good question,” Governor John Bel Edwards said, when asked. “And I truly don’t know.”

Citing the legislature’s failure during this year's fiscal session to deal with the July 1, 2018, revenue loss of $1.2-billion in “temporary” taxes during the regular fiscal session, the governor explained his uncertainty.

“Until I can be reasonably assured that a special session would not result in the same inaction, the same failure of leadership, why would I call one?”

House Speaker Taylor Barras defended the lower chamber's inaction on the fiscal cliff, saying the time wasn’t right to deal with the issue.

“You know, when you’re asking for raising taxes in one of Louisiana’s weakest economies – you can’t do tax policy and tax increases in a recession. That’s just not good business.”

And, Barras added, comprehensive tax reform is a massively complicated undertaking.

“You’re talking 13 or 14 different pots of revenue – whether it’s corporate tax, income tax, inventory tax – I mean, it’s hard to pick one or two without affecting the others, and doing the right thing as relates to policy,” Barras says. “That’s a bigger discussion than a 60-day session.”

Governor Edwards insists that discussion has already been had, via the tax reform task force the legislature created.

“The legislature, and specifically the House, had before it every single thing that the task force recommended for budget and tax reform, and to stabilize our state – and did none of them,” Edwards insists.

But Barras says the House did attempt a piece of the needed tax reforms, approving bills establishing flat income tax rates. but because they were “revenue-neutral”, Barras says, the administration didn't want them, and so the Senate set the bills aside.

The Speaker says he expects the House will ultimately want to take a half-and-half approach to the fiscal cliff, raising revenues while making further cuts to state spending.

The governor says he’s waiting to see the House plan before he’ll call another session to try and implement it.

“As we get closer to the cliff, I expect some folks will take it more seriously.” Edwards says.