Tax increases approved

A House panel approved more than $180 million in tax increases Tuesday, getting a start on plugging an estimated $600 million budget shortfall during the year’s second special session, which ends June 23.  
The biggest move was a tax on health maintenance organizations, by Rep. Andy Anders, D-Vidalia, that would raise more than $150 million this year. House Bill 35 passed unanimously.  
The tax increases approved Tuesday by the House Ways & Means Committee will be heard on the House floor later this week.  
But House Republicans on that committee rejected more than a dozen other revenue-raising measures.  Some lawmakers refuse to raise any new taxes, while others reject what they see as “bad policy” without a tax overhaul.  
Without any new revenue, TOPS students would likely pay roughly half their tuition bills the next semester, and the state’s safety-net hospitals would face deep cuts and some could close.  
Many of the measures heard Tuesday were shelved voluntarily after meeting opposition, and are expected to come back after legislators work out compromises.  
A bill that would reduce the amount individuals can deduct from their state income tax when they itemize was shelved voluntarily by Rep. Rob Shadoin, R-Ruston.  
House Bill 11 is a cornerstone of Gov. John Bel Edwards’ package to plug the budget shortfall, and would raise more than $116 million for the upcoming fiscal year.  
It would reduce excess federal itemized personal deductions which provide tax breaks for things like home mortgage interest, charitable contributions and medical expenses, to 57 percent. Eight states don’t allow any of those deductions, and Louisiana is one of a few that allow 100 percent deductions.  
Some Republicans on the committee expressed support for the measure, but only if it was part of a broad “reform” of the state’s tax code by lowering rates, broadening the tax base and eliminating deductions and exemptions.  
Dawn Starns, state director for the National Federation of Independent Business, said the move would be “painful” to business owners.  
A different bill to compress the income tax brackets, effectively increasing taxes on some, was also deferred after meeting opposition.
Rep. Eugene Reynolds, D-Minden, voluntarily shelved that bill, HB40, which would have raised nearly $400 million and almost solved the state’s $600 million budget gap.  
Committee members voted 7-11 against a bill that would reduce by 50 percent the net capital gains deduction, which benefits mostly high-income earners. The deduction was added in 2009 to keep “high net worth individuals” in the state when they sell companies, according to the Department of Revenue. 
Rep. Chris Broadwater, R-Hammond, was the only Republican in favor.