State Treasurer John Kennedy just released the revenue numbers for January 2016. They’re a mix of good news and bad news.
The good news for the state is that revenues are up 3% from December 2015. The bad news is that they’re down 12% from last year.
Here’s the press release from Kennedy’s office:
The January 2016 Net Receipts Report shows that total state revenue thus far for 2015-2016 was $4.198 billion, a 12% decrease compared to that time last year, but a 3% increase over December. Sales tax, severance tax and corporation/franchise tax receipts are down from last year. Individual income tax revenue is up slightly over last year.
In December, total state revenue was down 15 percent, or $636 million. Comparatively, state revenues improved 3%.
The report includes receipts for sales tax, individual income tax, general severance tax, corporation and franchise tax, gasoline and special fuels tax and miscellaneous taxes cash receipts. The report does not include gambling revenues, fees, self-generated revenue and statutory dedications.
What changed between 2015 and 2016? In 2015, the Louisiana Legislature raised taxes on businesses and individuals. Severance tax is being hurt by the abnormally low oil prices we’re experiencing right now. Our oil industry is dying.
The Legislature, with the full backing of John Bel Edwards, thought that it could increase revenue to the state by raising taxes and “closing loopholes.” According to Treasurer Kennedy’s numbers, this attempt has failed.Of course this was not unexpected. If you tax something, you can expect less of that activity. If you tax business, you can expect them to do less business. That means less money for the state.
Let’s hope John Bel Edwards and the Legislature don’t make the same mistake again.