Posted: Sep 20, 2010 9:01 PM by Alison Haynes
BATON ROUGE, La. (AP) - If Congress allows any of the Bush
administration tax cuts to expire, Louisiana's state coffers will
take a hit.
Louisiana's tax code is tied to the federal tax laws. Louisiana
lets its taxpayers deduct the amount of federal taxes paid from
their state liability. So, if people pay higher federal taxes, they
will get a greater deduction on their state taxes.
Economist Greg Albrecht told the state's income forecasting
panel on Monday that if all the tax cuts expire, Louisiana will
lose about $120 million a year in state tax income.
If Congress backs President Barack Obama's plan and only renews
some of the tax breaks, Louisiana will lose between $30 million and
$40 million a year, said Albrecht, the chief economist for the
Legislative Fiscal Office.
The impact wouldn't be felt until the 2011-12 budget year, he
told the Revenue Estimating Conference.
The federal tax cuts pushed by President George W. Bush's
administration and enacted in 2001 and 2003 are set to expire in
January unless Congress renews them. Obama supports extending the
tax cuts for individuals making less than $200,000 and joint filers
making less than $250,000 in adjusted gross income.