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Jindal Tax Amnesty plugs budget hole: Total $435 million

16th December 2013   ·   0 Comments

Legislative critics believed that Governor Bobby Jindal’s proposal to amelorate devastating cuts in Health Care and Higher Education in this year’s state budget, through collecting defunct taxes, was overambitious at best, insane at worst.

Yet, it worked better than anyone hoped. Louisiana’s tax amnesty program earned a total of $435 million, the Louisiana Department of Revenue revealed on Thursday, December 12, 2013.

That final figure more than doubles the $200 million that legislators had targeted the program to collect, and means that not only will many of the cuts to the hospital program will be delayed and reverse, but quite a few colleges will see fewer staff and course cuts than were originally planned.

LDR Secretary Tim Barfield ended the month of November with the news that his department had met the original $200 million goal. “Taxpayers responded enthusiastically to the opportunity to fulfill their obligations and settle their accounts with the state,” Barfield explained in a statement to the press.

“We believe we have received the overwhelming majority of applications, and we continue to process those applications that were submitted by the deadline to ensure compliance with the amnesty eligibility requirements.”

Of the $435 million entering state coffers, roughly $369 million came from accounts under audit and litigation, where corporations and business have contested sums. Another $66 million was earned from delinquent tax collections generally involving individuals. Moreover, Amnesty collections also brought in $67 million paid using transferable tax credits.

LDR estimates the cost of administering the amnesty program, including its share of outside legal fees, is approximately $14 million. And, as the law stated, the taxmen get their cut first. LDR will retain about $64 million to replace penalties and fees waived under the program.

The tax amnesty program provided a method for eligible taxpayers to pay back delinquent taxes without penalties–and to come out of pocket for only 50% of the back interest.

This article originally published in the December 16, 2013 print edition of The Louisiana Weekly newspaper.

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