On Friday June 26th, Dan and Dave on the Air had on as a guest Louisiana Representative Sam Jones to discuss the Louisiana Legislative Session. One of the topics that came up was the issue of why the legislature was not able to pass legislation that would have forced Bobby Jindal to veto a bill to prevent Louisiana from accepting those additional unemployment funds.
We all know that one of the excuses Governor Jindal gave for rejecting those funds was that it would increase taxes on Louisiana business.
As Tim Barfield, Jindal’s appointment to the Louisiana Workforce Commission, stated:
“This amendment would have the effect of changing our current law in a way to use temporary federal stimulus money while resulting in a long term tax increase on Louisiana businesses who will long after be taxed along new experience ratings that are used to calculate their individual tax rates.”
However, the shocking revelation that we heard from Representative Jones was that Jindal’s refusal of these funds has caused an increase on business taxes.
Let me repeat that just in case it didn’t sink in. Jindal’s refusal to accept the unemployment funds from the stimulus package has caused an increase of taxes for Louisiana businesses.
How so? Well, Louisiana passed legislation last year that established a lower unemployment tax rate as long as the Louisiana’s Unemployment Insurance “trust fund” stayed above $1.4 billion. According to Representative Jones, the trust fund has dipped below $1.4 billon, triggering an increase in unemployment taxes back to the old rate.
Had Governor Jindal accepted the stimulus funding, the trust fund would have been funded above $1.4 billion and no tax increase would have been needed.
So, according to Representative Jones, the exact thing Jindal was worried about in changing the rules is the thing that happened because he didn’t.
