21 States Warn Language in American Rescue Plan Act Could Prevent States from Implementing Tax Relief
BATON ROUGE, LA - Louisiana Attorney General Jeff Landry is urging the United States Department
of Treasury to uphold Louisiana's right to
cut taxes.
Joining a
coalition of fellow state attorneys general in a letter to Secretary Janet
Yellin, Attorney General Landry notes that certain provisions in the recently
passed, hyperpartisan “American Rescue Plan
Act” forbid states from using COVID-19
relief funds to “directly or indirectly
offset a reduction in…net tax revenues”
resulting from state laws or regulations that reduce tax burdens, whether by
cutting rates or by giving rebates, deductions, credits, “or otherwise.”
Attorney General Landry warns
that this language could be used to deny Louisiana and other states the ability to cut taxes in any manner, even if they
would have provided tax relief with or without the prospect of COVID-19 relief
funds. The letter urges the Department of Treasury to adopt a more common-sense
interpretation of the language, warning that a broad interpretation
would result in an unprecedented and unconstitutional intrusion on the
sovereignty of the states.
“We can not allow
the federal government to usurp Louisiana’s
constitutional authority to govern itself,” said
Attorney General Landry. “If we do, it will be the end of state sovereignty.”
Attorney General Landry and 20 of his
colleagues from across the Nation also warn that a
single governor could accept stimulus funds and thereby bind both his state legislature and his
successor from cutting any tax or tax assessments in the near future. This
would be a clear intrusion by Congress upon the democratic structures of the states.
Accordingly, Attorney General
Landry is asking the Treasury Department to confirm that the American Rescue Act simply precludes express use
of the relief funds to provide direct tax cuts. The
attorneys general vow to take appropriate action if
such a guarantee is not provided to ensure
that states like Louisiana have the clarity and assurance needed to enact and
implement sensible tax policies for its
taxpayers.
Joining Attorney General Landry
in this
call were the attorneys
general from Alabama, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana,
Kansas, Kentucky, Mississippi, Missouri, Montana, Nebraska, Oklahoma, South
Carolina, South Dakota, Texas, Utah, West Virginia, and Wyoming.