Senate sends tax bill to governor

BATON ROUGE — In a 33-6 vote Sunday, the Senate sent a sales tax bill to Gov. John Bel Edwards that could end the financial instability that has dominated discussions at the Capitol and led to seven special sessions since he took office in 2016.

The bill, which represented a compromise Friday between Edwards and House Republicans, will extend 0.45 of a cent of sales tax that was scheduled to expire on July 1.

That will lower the state’s portion of the sales tax to 4.45 percent from 5 percent now. But by not letting the full penny expire, it will raise $463 million to fully fund TOPS scholarships, higher education and state health services and reduce cuts in other areas. The extra 0.45 of a cent will expire in 2025.

Edwards and House Republican leaders also have grappled for control over the budget process, and the Senate voted 39-0 Sunday to pass a supplementary budget bill after acceding to House demands about how some of the spending choices might eventually be made. The House then ratified that deal 88-7, ending the special session.

The Senate tax votes came after months of intense infighting between Edwards, who initially warned that the state faced a $994 million budget shortfall, and House Republican leaders, who want to shrink the size of government, contended that the budget hole was much smaller.

A deal ended up being possible partly because changes in federal tax laws created a windfall in state tax collections, reducing the projected shortfall by nearly a third, and lawmakers agreed to apply tens of millions in damage payments from the BP oil spill to the budget.

In the end, there will still be cuts in the budgets for corrections, juvenile justice and other programs. But most Democrats and Republicans agreed that they were manageable.

Edwards has said that the state was in a $2 billion financial hole when he took over as a result of income-tax cuts by former Governors Kathleen Blanco and Bobby Jindal and Jindal’s expansion of tax exemptions for corporations that the state is still digging out of.

But in opposing the sales tax bill Sunday, Sen. Sharon Hewitt, R-Slidell, argued that taxpayers had been left out of the conversation.