Lawmakers Raise Concerns Over Governor Landry’s Tax Plan, Citing Impact on Working Families

BATON ROUGE, La. — Louisiana’s working families could face higher costs on essential services under Governor Jeff Landry's new tax plan, lawmakers warned Wednesday. The proposal, which aims to broaden sales taxes on services like home repairs and car maintenance, met strong opposition from House Democrats, who argued it could disproportionately impact low- and middle-income residents.

The plan advanced through the House Ways and Means Committee, marking its first legislative win. However, lawmakers in opposition contend that the proposal—designed to replace revenue lost from cuts to personal and corporate income taxes—places a financial strain on families already contending with rising living costs. Essential services ranging from pet grooming to vehicle repair would become taxable, potentially adding significant expenses for everyday necessities.

Representative John Cunningham (D) voiced deep concerns, stating that taxing services commonly used by working families "creates an imbalance that favors those who can afford professional services untouched by the tax." Under the proposal, larger contracts and professional services, including those provided by accountants and attorneys, would remain exempt, sparking criticism that the plan is unevenly applied.

“This exemption for higher-end services doesn’t sit right with me,” Cunningham added. “Families shouldn’t have to shoulder an additional tax just to get their car fixed or their roof repaired when corporate taxes are being slashed.”

Insurance industry lobbyists also expressed worries, suggesting the plan could drive up insurance premiums. They argued that increased repair costs on taxed services would lead to higher claims, which insurance companies would then pass on to policyholders.

The tax structure includes an exemption for capital improvements, such as major roof replacements or remodels, while smaller repairs would remain taxable. Democratic lawmakers argue that this distinction could place a heavy administrative burden on small business owners, who would need to differentiate between repairs carefully and remodels, a task many say would be costly and time-consuming.

Secretary of the Department of Revenue Richard Nelson defended the proposal, highlighting that revenue from the new taxes would go toward eliminating the tax on prescription drugs, aligning Louisiana with other states and potentially easing medical expenses. He contended that expanding the tax base would allow income tax cuts that benefit residents statewide.

Despite this defense, House Democrats remain concerned. They warn that the financial effects of taxing daily services will fall hardest on residents least able to afford it, creating what Representative Sarah Dupree (D) called “a regressive burden that goes against the interest of families across Louisiana.”

As the bill progresses to further House debates, the conflict between tax reform and economic equity remains front and center, with lawmakers weighing how to balance budgetary needs against the rising cost of living for everyday Louisianans.