By JSB Morse
My wife and I decided to move to Louisiana from Texas in 2015 for her to be closer to her family and for me to be closer to good gumbo. It was a difficult move because Texas was the land of opportunity with no income tax, a flourishing economy, and the best brisket in the world. But, while I was leaving the fourth-best state with regard to taxes, I was please to see that Louisiana was actually right behind Texas in fifth place, according to Forbes.
Things were looking up and the gumbo was placating my hankerin’ for brisket until I started doing my taxes and realized I just got a 6% pay cut by moving here due to the income tax that Texas somehow does without. What’s worse is that I learned budget shortfalls were forcing you raise taxes in addition to make budget cuts in order to fill the gaps.
One of your planned hikes is an increase in sales tax. Right now, Louisiana gets a low percentage of its revenue from sales tax (3.3% compared to the national average of 5.5%) and, all things being equal, economies fare better when government taxes consumption as opposed to production or income. So, that’s not such a bad idea on its face.
But raising the state sales tax without reducing other taxes will just knock the state of its top-five states for taxes and distance itself from the leaders in the country.
Study after study shows that the freer any given economy is, the better quality of life is for people within the economy:
And Americans are becoming more and more mobile, moving to states with lower taxes and better employment prospects:
Increase the sales tax if that is necessary to balance the budget, but I implore you to ensure that subsidies and income taxes are reduced as well. If you really want to dramatically improve the economy of this state, figure out a way to do what Jindal couldn’t and eliminate the state income tax altogether.
You want people like me to move to Louisiana, Governor Edwards. Don’t make me regret that I already have.
JSB Morse is an author, entrepreneur, and chair of America’s Future Foundation New Orleans. He can be found wherever there is good gumbo or at jsbmorse.com