Mar 5, 2014|
Garland talks tax credits with Louisiana Economic Development Secretary Stephen Moret.
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Automatically Generated Transcript (may not be 100% accurate)
We're talking about a legislative audit that says tax credits and easier in the caucuses three billion dollars. According to the news sources and Weezer and give weight that the 5% corporate tax revenues over five year period. -- government gave up about three billion dollars in taxes. To encourage companies to -- -- humans they Stephen Moret with the secretary region in the moment ago. And should DiMarco it boarding your thoughts on this. -- -- -- It is in a mall for the movies and and and all -- -- -- -- business. When you bring at least these articles of -- each one minute week in and higher education and retirement says some. Today when Leo you were -- Well this person I think it's important to -- -- -- -- important facts. For at least our widgets for key facts personable. Girl I think it's unfortunate that every business. And every family in every adult and -- utilizes state tax exemptions on a regular basis their personal one. He -- an ambulance for example. Not just about as efficiently utilized as the State's sales tax exemptions for purchases of -- trees could control and residential utilities. Certainly businesses. Is a variety of exemptions as well and obviously all the exemptions out of a variety of different. Purposes but they'll play at up to a significant number. A second to really get the hard work the legislative. Auditor would be -- Sig added to a significant number. -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Of all the state tax exemptions and we've you know the total now that the fact that that three billion dollar number was the total think for just two of the tax types over. Conversely cheers but on an annual basis. The total amount of state tax exemptions and credits them -- you know. And actually six and a half to seven billion dollars. Per year including both individuals and businesses roughly equally divided between acute. The three billion dollar number and worsening water -- not challenging the number -- just pointing out that this is that that's not the total that is small subset. All the exemptions and includes -- that through going to number it was a lot more. In the economic development. It's if you look at all the state tax exemptions and we you know again about six and a half to seven billion dollars a year. Only about 5% or less who's actually associate with economic development. Roughly 95%. Of the state tax exemptions and Louisiana. Are really designed to lose Europe and they're designed to serve some kind of public purpose whether reducing. The cost of you know life's necessities like -- trees description drugs or rent and utilities. -- making the state. More competitive. Without you know competing states for a particular industry sector but not actually treated to it and I'm not sure. Connect to job creation. And enforceable nationally important fact or this year that is for reporters and the effort to my knowledge every stage of interstate that we analyzed. Has tax exemptions on more exemptions and others. The real question is you know what's the right in his system overall and I certainly agree. And you know having -- exemptions -- would be better because you can raise the same amount of tax revenue was lower rates. And a more stable system. Also there's definitely some and heading in that direction. But when you think about tax exemptions in the week you know there's really only a very small proportion of the total at least economic development. Just. Got through and be over soon so -- on this. Aside he said the State's outgrow it and you do you said the when it comes to attract recruits in particular business. It adds up to a slush flown with the legislature. It's our money legislature shouldn't be news to decide what they're gonna do with that. And this this is a quote Romo web site on the Internet. Tax breaks are merely a symptom of unfair tax code and other award. Louisiana's taxes or to lost their businesses and individuals who museum of bouts of breaks. And thinker we've even mention that and a much what we're doing a little musical and state square do we years ago. Yes. I agree with a few of the statements that he may have disagreed Tuesday certainly agree that the legislative order plays of the role -- the state. I agreed that the film. Incentive program is his very expensively so that publicly on on multiple occasions at all and also however as a program that's created in support a lot of jobs. And our state and I agree with mr. science class for that in general it would be better if we. A much smaller number of exemptions which would allow us to -- -- lower tax rates than we have today. But I disagree and several important ways one instrument suggests that we it isn't growing just just as an -- and if you get back to discover took office at the beginning of the great perception. We're we've literally ranked number two from the south and number four in the country from private sector job growth that period Thomas or numbers as the US Europe. Of labor statistics it's an unassailable. Fact that we -- on the south we've -- -- in the country. I think secondly. But it did primarily because of the federal blow billions in here end. Populace who was his primary early returning -- and it's. No that's not correct if you if you look at the history of when Katrina money was being Stan. But because that spending occur around 2000 -- to those -- it's actually been coming down since then I wanted to. One of the toughest challenge is that harsh statements based economically the last roughly three to four years. Has been as. Katrina related recovery spinning has been going away protections and job losses as it would in the construction sector in particular. There have been offset but other projects within social sectors should -- do you think that it helped us that the beginnings certainly. But it certainly didn't net negative when you look at the beginning of this administration. To the current top. But it probably live let me take a break here and group. -- known as break come right back we're talking about an audit legislative law that says. Tax credits to business in particular colossal and three billion dollars over five year Perry what do you think. Comments questions to six or 187 and gives -- 87870. With -- get about a legislative. Awkward -- report. The -- tax credits in Asia and primarily does this crosses three billion dollars. 55%. Of corporate tax revenues were five year period -- Stephen Moret this secretary Louisiana economic development. Even when the went to these these tax credit Cuba like the moves and that in particular. New Orleans would. Tourist based economy and this this is something we can report to duty worldwide publicity -- their report. Hard to determine just how beneficial but I gotta believe it's pretty been approved with least. Or New Orleans. Opened a look at what's happened to higher education funding and jungle the retirement system. College tuition could be going up eighty million dollars this coming year a CB -- guts and website what is says. -- -- -- Per stripped the tax code down to bare bones no exemptions exclusions or deductions. Would you rate billions of dollars and net. Roll back the tax rates on the new neutral basis where each brought it and -- no board and don't currently. And by revenue -- -- -- Neutral zone would pay imports would pay left the whole world. -- overall it's all would be better. Compare world. Other states. And as we did that would attack code that would reduce most acts is completely weak yen. -- one of the most attractive states. In the country. For individuals and business -- -- -- I think the general direction of what he's talking about makes cents I don't I don't think I would initially -- zero exemptions because there are some things I think are. Very important that people would probably tend to agree on like you know accepting purchases of commercial reasons present utilities and kind of basic necessities of life. And -- do you think that there's a place war. Targeted economic development. Exemptions that are you know have a proven track record. But that's think in general we certainly would be better off with a tax system. For a list exemptions and lower tax rates. To go along with him or vault to the -- to -- of propriety of this it's part of a significant benefit would be. Two but significantly once simplicity to him a lot simpler. The other benefit would be that it would be more obvious that we are one of the lowest tax -- potentially a look at Louisiana. Our actual tax burden from those families and those businesses who's close to blows in the country were one of -- in the bottom five terms of the the least amount of tax burden at state and local level combined. Not the tax rate to talk about what people actually pay more businesses to actually pay what you take into account the myriad. Tax exemptions that are available so we kind of have a disconnect between. Perception of reality because our our tax rates are actually somewhat higher than is typical in the south in the country because of the large and now. The reductions at Charlotte north mentioned two very important areas I disagree with. Now mr. -- on one as he suggested that the states don't have. These credits they eliminated. In decades here that is absolutely 100% faults. -- New York Times to the piece a while back approximately 2000 chwo they actually did a comprehensive look at all the tax exemptions states across the country it's publicly available on the website look at it right now. The Texas for example the only state in the country in the south that they'll perform week in the last six years actually -- more tax credits and exemptions than any state in the country. They have more than -- per capita basis as well. -- we you know certainly is one of the war interstates were shortly above the average. There are many states that have more exemptions in total more exemptions per capita terms of the value. But the -- you know as we are surely not -- cannot ignore I think it's a tendency to struggle with because what you try to exceptions they're hard to eliminate. From the last thing I think it's important to know that the I would disagree with as long as this notion that. The legislature. Only he has somehow you know giving out these. Exemptions and discretionary away when you look at the tax -- it. More than 98% for a suspect more than 99%. But the available tax exemptions by a number about values are certainly the value and we you know. -- and the numbers well. Are not discretionary and they are established and state law any company or any individual who's eligible to utilize this can use them. There's no discretion given to legislature war to not only do you whatsoever. They're very small number exceptions that the vast majority are sentenced to outlaw state law and anyone who wants to utilize them and has multiple conditions. When we failed -- and do you listen to other. If it's like we're doing better than we've ever. Like waltzes and who were improving. Overall. We still cutting. Emissions to stoke the -- And we. Not lending arm. Won't be putting people that. And kid that or. And having hard time getting states uses its. Well then there's a there's a couple reasons and certainly the biggest of which is that we did. Take office during a difficult in time for the country and I think all the things you list the things that virtually every state in the country is Strobl would. The last few years I think secondly there's no question that there has been significant growth. And the utilization of some of those tax exemptions have been packets take action as we look at the film production tax credit for example. It's been a wonderful success story in terms are creating and sustaining many many jobs probably 101000 more jobs in the -- you know. But there's also no question that it has resulted in net production. And revenue available for health care and our educational areas because it doesn't generate. You know Jerry -- actual music costs and tax credits you know generates a tremendous amount of economic impact. So we've done much better that the vast majority of the states in terms of job growth and employment population and so forth over the last six year period. But there's no question. Our tax structure even though we have all the tax burden -- -- There's definitely room for improvement that's that's why we took it on last year -- -- was actually. If the legislature -- not been willing. To eliminate income tax they obviously weren't. You know the back. Options than the obvious backup option would have been to just simply eliminate. A large amount of exemptions or actually it's -- and revenue neutral way until hope that that's an opportunity at some point in the future. Look we're we're out of time we can only get both sides all new both sides agreed to coma and so I appreciate -- time you -- today. The issue girl thinking.