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The Political Collapse of Bobby Jindal

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lawhawk4/08/2013 1:15:08 pm PDT

He’s not exactly going down without a fight, nor is he giving up the ghost about eliminating the income tax in Louisiana.

As I commented earlier, he’s calling on the Legislature to work on a way to get to the elimination of the income tax.

There’s a reason that states impose the kinds of taxes they do.

Broadly, it’s to generate revenue to fund government activities. Sometimes it’s to tax specific activities as a deterrence (sin taxes). Many states impose property taxes to fund education, and offset the burden with other taxes. New Jersey, for instance saw a huge property tax burden and decided to broaden the tax base by imposing an income tax and creating rebates and other incentives to reduce the tax burden on property owners as well as to increase support to poorer districts.

Jindal’s wish was to eliminate the income tax and offset the revenues by hiking the sales tax.

Sales tax by its nature is highly regressive. It’s why sales taxes generally exempt food purchases and some states don’t tax clothing - because it adversely affects the poor most (a disproportionate amount of their income goes to paying the tax as compared to someone who’s wealthy). Hiking the sales tax only adds to the disparity and Jindal’s attempted sop by creating some kind of rebate actually undermines his argument for eliminating the income tax. But he’s not going to stop trying.

Louisiana is in a position where it could increase taxes on gas/oil/minerals, but those costs would be fought by the oil/gas industry. Louisiana isn’t Alaska, where oil finds transformed the state’s wealth and revenue picture overnight. Louisiana isn’t creating a new revenue stream - it’s shifting the burdens on to those least able to afford them.

And he’s not alone with that idea. Kansas (go figure), North Carolina, and Nebraska are also looking at a possible elimination of their income taxes.

Each faces a similar problem - what to tax if you’re taking income out of the formula. That pretty much leaves sales and property taxes. Or vastly smaller governments that can’t provide the level of service that people now are accustomed to.