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Local officials oppose bill to exempt groceries from local sales tax, citing large fiscal shortfall
Summary
Representative McCormick proposed exempting certain food and beverage sales from local sales taxes; local tax administrators and municipal officials warned the measure would create a statewide local revenue loss of roughly $683 million and municipalities said the loss would be devastating to services.
House Bill 229 by Representative McCormick would exempt certain food and beverage sales from local sales taxes. The sponsor said the change would ease costs for young families and seniors and make groceries more affordable; he also said cross‑border shopping with Texas (which he said has different rules for grocery sales tax) motivates his proposal.
The Louisiana Association of Tax Administrators (LATA) provided the primary fiscal analysis and submitted a red card of opposition focused on the fiscal note. LATA’s representative, Drew Talbot, told the committee the association calculated a negative statewide local revenue impact of about $683 million in fiscal 2025–26 and that the impact would grow about 6.25% annually thereafter; the calculation used state data on food for home consumption and converted it to an average local rate (about 5.1%).
Local elected officials and municipal leaders gave multiple statements in opposition, saying local governments rely on that revenue for basic services including roads, water and sewer, law enforcement and schools. Guy Cormier of the Police Jury Association described the fiscal note as exceptionally large and said it would “crush” many parish and municipal budgets. Representatives heard specific local impact estimates: the city of New Orleans told the committee it would lose roughly $17 million and the school board about $5.6 million.
Representative McCormick said he introduced the bill to reduce the tax burden on working families and said he would work with stakeholders; he also agreed to leave the bill in committee for further consideration. Committee members and witnesses urged detailed local fiscal planning to identify offsets if local sales tax revenue were reduced.
Why it matters: local governments rely heavily on sales tax revenue; a near‑$700 million annual reduction in local receipts would affect public safety, schools, roads and municipal services. The committee did not advance the bill and left it in committee for further work.
