Louisiana lawmakers are still considering taxing multiple types of personal services to make up for the losses the state would accrue if it goes forward with lowering the personal income tax rate to a flat three percent. An advocate for Louisiana's small businesses says this could lead to disaster.
Leah Long, the Louisiana and Mississippi state director for the National Federation of Independent Business, says Governor Jeff Landry's plan to tax certain personal services will do more harm than good to business in Louisiana. In fact, she told WWL's Tommy Tucker the costs of those added taxes could sink some mom-and-pop establishments.
"That list still hits the smallest of the small businesses," Long said. "Those people don't really have the capital or maybe the extra income to invest in tax compliance. That's one thing we're concerned about because these small businesses are already struggling in an already inflated economy."
Long believes advocacy group says lawmakers are missing a major piece of the tax reform puzzle.
"If we're going to impose new taxes, we need to have a centralized sales tax collection," Long said. "These small businesses that already have to pay taxes and collect . . . sometimes they have to remit to 54 parishes, and so our tax structure is very hard, very difficult here."
According to long, small businesses will have to spend more money to make sure they're in compliance with these proposals if they become laws. That's because under one proposal, they would lose payments they receive for remitting sales taxes on time. Long added that the state's decentralized tax collection system will further complicate matters if these proposals become law.
"If they did in fact want to expand the base onto services, make it easier for these business owners to collect and remit because even these small business owners that do that, I guarantee it's a pain for them to remit to 54 parishes depending on their type of business."