Louisiana’s House Ways and Means Committee revived an income tax repeal bill that suffered a few blows while under discussion in the Senate.

Senate Bill 259, which is authored by Democratic senator Rob Marionneaux, has been changed by the Senate in order to make it a study rather than an absolute tax repeal as state senators were concerned over the loss of billions of dollars in state revenue and potentially crippling state services without a clear plan on how to replace the lost funds.

The legislative proposal initially seeks to cut state revenue by at least $113 million starting 2014. Considering that tax collections increase over time, the expected loss in revenue is seen to reach $5 billion by the time it is totally implemented.

Sen. Marionneaux, meanwhile has allayed fears of his colleagues by proposing that the lost revenue will be replaced by lifting some of the tax exemptions and credits that Louisiana’s legislature has given over the years that amount to almost $7 billion.

“There’s a way to do it,” explains Sen. Rob Marionneaux on finding alternative source of revenue for the state in place of the personal income tax. Meanwhile, the Louisiana’s Department of Revenue stated that the state government gave up around $7.1 billion in collections last year that could have been collected if not for the tax exemptions and credits. It is also expected to forego an estimated $7 billion of tax collections next year.

Some of those exemptions include credits for filming production, which has helped Louisiana become the third most popular destination for making movies. Additionally, the legislature has offered considerable tax breaks for natural gas drilling in the Haynesville Shale region.

The Senate preferred instead to have a commission created that will make recommendations to lawmakers on how to lower the income tax and study the impact of various means to make up for the lost revenue including spending cuts or elimination of current tax breaks. However, any plans by State Commission on Revenues and Expenditures (SCORE) would not be binding. Lawmakers still have the option to approve, change, or completely discard the commission’s recommendations.

Sen. Marionneaux and Baton Rouge representative Hunter Greene, who is leading the income tax repeal campaign in the House, both agree that that the bill is likely going to die when placed under SCORE. As the bill headed back to the House Ways and Means Committee, it sprung back to life when they announced that they are going to proceed with the complete phase-out of the personal income tax within 10 years starting in 2014 regardless of what SCORE will recommend. Of the two state legislative chambers, the House is regarded as more conservative. Both are controlled by Republicans legislators.

Some states such as Florida, Nevada, and Texas have no personal income tax. Some argue that the absence of income tax attracts people and businesses. As more people move to one state, a lot more economic activity is created, boosting revenue from sales tax and eventually creating more jobs. As small businesses spend less on taxes, it allows them to invest more in expansion and hiring people.