The Facts About Sales Tax Increases in Louisiana

I have to pause and laugh when I see the recent political ads concerning the upcoming governor’s election.  While it is not my intent to make any formal endorsement of any candidate, it is necessary to clarify some misinformation in the ads.  All revenue generating bills for our state, as clearly delineated in the State Constitution, must originate in the state’s House of Representatives.

The governor of our state can wish for and propose any revenue seeking desires he or she wants, but has no power to directly implement such revenue generating measures.   It is up to the House of Representatives to propose the revenue generating bill, vote on it, and if passing it, send it to the state Senate for their approval by vote.  If both legislative houses pass the revenue bill, it then goes to the governor for his/her signature into law or a veto.

So while the latest political ads regarding the governor’s race talk about our present governor raising taxes, technically it was the Republican controlled House of Representatives that formulated the proposed sales tax increase bill and approved it, along with the Republican Senate.  Both had to approve the sales tax increases in Louisiana for them to be implemented.  To infer that the present governor of our state single handily raised taxes is an outright distortion of the facts of how revenue generating actions take place in our state.

On another matter, it’s too bad that we don’t hold elections every year, for that is apparently the only time that some of our legislative leaders really try to do their job to help their constituents.

Case in point is the State Insurance Commissioner, Jim Donelon.  Our state has one of the highest automobile insurance rates in the nation and has an absurd hurricane deduction on most homeowners policies written in Louisiana.  Almost all homeowners policies contain a 2 to 5 percent deductible of the total value of the home before any damages are covered in the event of hurricane damage.  For example, if your home is valued at $250,000 by your insurance company, and you have a 3% hurricane damage deductible, the insurance company will not pay for any hurricane damage your home sustains until it exceeds $7,500.  A 5% deductible would increase that out of pocket cost to $12,500.

Our present insurance commissioner has recently risen to the occasion on this issue and issued a “cease and desist” order to State Farm over its practices of hurricane deductibles regarding the recent storm Barry.  However, this entire deductible scam by all the homeowners insurance  companies needed to be dealt with long before Barry, but I guess now that Donelon has a credible challenger to his job he decided to get some press P.R. showing he’s looking out for the consumer.

And let’s not even discuss how on Donelon’s watch auto insurance companies are allowed to get a 10% increases in their rates automatically each year without approval and review by the state insurance commission.  However, I will give our present insurance commissioner one accolade, at least he hasn’t gone to jail like our previous ones.

Each of us now has a great opportunity to change things in our state by going to the polls and voting for individuals that will truly represent us.  Sadly, incumbents have one big advantage, name recognition.  Please do not fall for that trap.  Vote for someone who you think will truly represent you.  Give some of the unknowns a chance based on their qualifications.

Some of our present reps, all the way up to our lieutenant governor, have had questionable ethical improprieties that have been noted in the media.  It’s time to throw them out.  The power is in your hands by voting to change the status quo in our state.