Louisiana Governor Jeff Landry plans massive tax system overhaul in Special Session

Gov. Jeff Landry has called a Special Session to ask lawmakers to revamp Louisiana’s tax code by lowering income tax rates for all earners and permanently raising the state’s sales tax.

The Special Session begins Nov. 6 and must end Nov. 25.

Landry’s plan would replace lost revenue from the income tax reduction by making a temporary 0.45-cent sales tax permanent rather than allowing it to expire in 2025 and by reducing the number of tax credits and exemptions on the books.

“This special session fulfills the promise we made to the people of Louisiana to rebuild our economy and make Louisiana a place where people want to raise a family and create jobs,” Landry said Monday in a statement. “Throughout this Special Session, we have the opportunity to give teachers a permanent pay raise, put more money in every worker’s pocket, eliminate the tax on prescription drugs and provide much needed tax relief for seniors.

“I am eager to enact this new playbook and finally make Louisiana a beacon of hope — inviting families and businesses back home. It’s time we move Louisiana Forward.”

If lawmakers approve Landry’s series of bills, voters would make the final decision on the proposals that would change the state Constitution to make the plan complete.

“We’re moving from taxing labor to taxing preferences,” Landry said previously.

The plan also would lower corporate tax rates while replacing that state revenue by reducing tax breaks and exemptions for businesses.

Landry has said the proposal will generally “lower tax rates and expand the tax base.”

The governor said when implemented his plan will “catapult” Louisiana to competitiveness with its southern neighbors, which have largely left Louisiana behind in population and economic growth over the past decades.

“During the past 10 years we’ve lost population while the state around use have grown; our ranking with the Tax Foundation has gotten worse; our wage growth is behind other states,” Landry said previously. “These statistics are a legacy of failure.”

Landry insisted his plan will set Louisiana on a path to both permanent prosperity and population growth.

“We will see a Louisiana that can compete,” he said.

More: Check out the proposed list of new Louisiana sales taxes from car washes, GPS, many more

Greg Hilburn covers state politics for the USA TODAY Network of Louisiana. Follow him on Twitter @GregHilburn1