One significant part of the proposal is the potential elimination of the state’s film tax credit, which currently costs Louisiana around $180 million per year.
The plan also includes eliminating sales tax on prescription drugs and increasing taxation on services considered non-essential, such as dog grooming and car washes.
The shift would move Louisiana towards a more consumption-based tax model, similar to systems in other states like North Carolina.
However, the proposal faces scrutiny. Representative Tammy Phelps expressed concerns about transitioning away from income tax too quickly, emphasizing the need to prioritize education funding to attract businesses.
Senator Adam Bass added that while a consumption tax could be fairer in theory, more information is needed before fully endorsing the shift, as he worries about its impact on the population’s spending and overall economic health.
This session could lead to a major overhaul of Louisiana’s tax system, with the aim of implementing these changes by mid-2025. However, lawmakers are still in the early stages of planning, and it remains to be seen how the final reforms will unfold.
