Multi-State
States with "High Rate" Income Taxes are Still Outperforming No-Tax States
February 28, 2013
Lawmakers in about a dozen states are giving serious consideration to either cutting or eliminating their state personal income taxes. In each case, these proposals are being touted as a way to boost economic growth. One claim often made during...Laffer's New Job Growth Factoid is All Rhetoric and No Substance
February 27, 2013
Read this Report in PDF Form“62 Percent” Statistic Says Nothing About the Impact of State Income Taxes on Economic Growth A new talking point printed on the opinion page of The Wall Street Journal is proving irresistible to state lawmakers...Who Pays? (Fourth Edition)
January 30, 2013
Major tax overhauls are on the agenda in a record number of states, and “Who Pays?” documents in state-by-state detail the precise distribution of state income taxes, sales and excise taxes and property taxes paid by each income group as...Previewing Tax Reform in the States: National Trends and State-specific Prospects for 2013
December 13, 2012
Washington, DC - Following an election that left half the states with veto-proof legislative majorities, 39 states with one-party rule and more than a dozen with governors who put tax reform high on their agendas, 2013 promises to be a...Five Steps Toward a Better Tax Expenditure Debate
October 1, 2012
Almost without exception, state lawmakers do not closely scrutinize special tax credits, exemptions, and other “tax expenditures” on a regular basis. A recent report by the Pew Center on the States found, for example, that half the states have done...State Tax Codes As Poverty Fighting Tools
September 13, 2012
2012 Update on Four Key Policies in All 50 States The tax systems of virtually every state are pushing poor families deeper into poverty. But state tax systems also have the potential to play a role in fighting poverty....Four Tax Ideas for Jobs-Focused Governors
July 15, 2012
As the nation’s governors gather in Williamsburg, Virginia this week, their focus is on their Chairman’s initiative, Growing State Economies. Too often, however, a governor’s knee-jerk response to a lagging economy is to start cutting taxes, even though state tax...How Federal Tax Reform Can Help or Hurt State and Local Governments
April 25, 2012
Federal tax reform can affect state and local taxes in several ways. The federal government can create, repeal or change tax expenditures in a way that is passed on to the states because virtually every state has tax rules linked...Arthur Laffer Regression Analysis is Fundamentally Flawed, Offers No Support for Economic Growth Claims
February 15, 2012
A November 2011 report from the Oklahoma Council for Public Affairs (OCPA) in partnership with Arduin, Laffer & Moore, a consulting group headed by Arthur Laffer, explains the method that Laffer has been using to make the case that tax..."High Rate" Income Tax States Are Outperforming No-Tax States
February 8, 2012
Don’t Be Fooled by Junk Economics With the economy lagging, lawmakers seeking to reduce or eliminate state personal income taxes are touting their proposals as tools for boosting economic growth. Of particular note are the governors of Kansas and Oklahoma,...Building a Better Gas Tax
December 14, 2011
State gas taxes are currently levied in every state, and are the most important source of transportation revenue under the control of state lawmakers. In recent years, however, state gas taxes have fallen dramatically relative to the rising cost of...Corporate Tax Dodging In the Fifty States, 2008-2010
December 7, 2011
In October, South Carolina Governor Nikki Haley suggested that gradually repealing the state’s corporate income tax should be a priority for lawmakers in 2012. Haley’s idea was alarming, but hardly surprising: in the past year, governors in Arizona and Florida...Corporate Taxpayers & Corporate Tax Dodgers
November 13, 2011
Earlier this year, Berkshire Hathaway Chairman Warren Buffett made headlines by publicly decrying the stark inequity between his own effective federal tax rate (about 17 percent, by his estimate) and that of his secretary (about 30 percent). The resulting media...State Tax Codes As Poverty Fighting Tools (2011)
September 22, 2011
This report presents a comprehensive view of anti-poverty tax policy decisions made in the states in 2011 and offers recommendations every state should consider to help families rise out of poverty. States can jump-start their anti-poverty efforts by enacting one...Sales Tax Holidays: A Boondoggle
July 14, 2011
Sales taxes are among the most important—and most unfair—taxes levied by state governments. Sales taxes accounted for a third of state taxes in 2011, but sales taxes are regressive, falling far more heavily on low- and middle- income taxpayers than...States Should Not Allow Amazon.com to Bully Them into Forgoing Sales Tax Reform
April 14, 2011
In just the last few weeks, Arkansas and Illinois joined New York, North Carolina, and Rhode Island in enacting legislation requiring some online retailers, like Amazon.com, to collect sales taxes on purchases made by their state’s residents. Vermont’s House of...Don't Give Up on Pease: States Can Decouple from Recent Federal Tax Cuts for Wealthy Itemizers
April 10, 2011
In 2011, thirty one states and the District of Columbia allow a group of income tax breaks known as “itemized deductions” (Figure 1). Itemized deductions are designed to help defray a wide variety of personal expenditures that affect a taxpayer’s...In It for the Long Haul: Why Concerns over Personal Income Tax "Volatility" Are Overblown
March 31, 2011
The precipitous drop in state tax collections during the recent recession has prompted some observers to argue that relying on volatile state taxes is a recipe for budgetary disaster. The most recent version of this argument, made by the Wall...Topsy-Turvy: State Income Tax Deductions for Federal Income Taxes Turn Tax Fairness on its Head
March 10, 2011
The budget outlook for state governments is bleak. Despite evidence that revenues are rebounding, there is a general acknowledgement that ?broad fiscal conditions remain fragile. The need for public investments—particularly health care for low-wage or unemployed workers and their families—is...The ITEP Guide to Fair State and Local Taxes
March 3, 2011
The ITEP Guide to Fair State and Local Taxes, released in March of 2011, offers citizens, activists, journalists, and policymakers a detailed primer on state and local tax policy. The guide explains the differences between progressive, flat, and regressive taxes...A Capital Idea
January 15, 2011
The budget outlook for the states is improving, but uncertain. In this context, states must find ways to generate additional revenue that create neither additional responsibilities for individuals and families struggling to make ends meet nor additional distortions in the...How the Bush Tax Cuts Affect State Revenues
December 15, 2010
Less than one month from now, federal tax cuts pushed through by President George W. Bush are scheduled to expire—and Congressional tax writers have spent much of this year debating how these tax cuts should be extended. This debate has...The Good, the Bad and the Ugly: 2010 State Tax Policy Changes
December 15, 2010
Compared to previous years, the budget outlook for the states improved only slightly in 2010 and virtually every state continued to face a budget shortfall. As a result, the overwhelming majority of state policymakers were put in the unenviable position...Credit Where Credit is (Over) Due: Four State Tax Policies Could Lessen the Effect that State Tax Systems Have in Exacerbating Poverty
September 15, 2010
The ongoing recession has had an unrelenting impact on families and communities in every state across the country. Millions of Americans are without work and in many cases those with jobs are experiencing reduced work hours and wages. New poverty..."Writing Off" Tax Giveaways: How States Can Help Balance Their Budgets by Reforming or Repealing Itemized Deductions
August 24, 2010
"Writing Off" Tax Giveaways examines options for reforming itemized deductions in the thirty-one states, plus DC, that offer such deductions. The study, released on August 24, 2010, focuses on five potential reforms: repealing itemized deductions entirely, capping the maximum size...Leaving Money on the Table: "Federal Offset" Provides Incentive for States to Rely on Progressive Income Taxes
April 10, 2010
Seven states—Florida, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming—have chosen to make up for the lack of an income tax by increasing their reliance on general sales taxes.1 The result is an “upside down” state tax system, which imposes...Who Pays? A Distributional Analysis of the Tax Systems in All 50 States
November 18, 2009
Who Pays? is a comprehensive analysis of state and local tax systems in all fifty states. The study, released on November 18, 2009, shows that on average, state and local tax systems require the poorest taxpayers to pay the highest...Recent Assertions about State Tax Increases Don't Hold Much Water [Revised Aug 7, 2009]
August 7, 2009
A more careful examination of Internal Revenue Service (IRS) data for the period from 1997 to 2006 reveals a far different picture, however. They show that the number of “rich” taxpayers (federal income tax filers with adjusted gross incomes (AGI)...A Capital Idea: Repealing State Tax Breaks for Capital Gains Would Ease Budget Woes and Improve Tax Fairness
March 15, 2009
This report explains what capital gains are, how they are treated for tax purposes, and who typically receives them. It also details the consequences of providing preferential tax treatment for capital gains income for states’ budgets, taxpayers, and economies in...Latest IRS Data Reveal Fundamental Mismatches in the States
August 15, 2008
Data released late last week by the Internal Revenue Service (IRS) indicate that 10 states have greater concentrations of reported income among their very wealthiest residents than the country as a whole. Unfortunately, the tax systems in those ten states...Combined Reporting - How Does Your State Stack Up?
April 15, 2007
Over the past few years, a number of states, seeking to address longstanding flaws in their corporate income taxes and significant declines in the revenue they yield, have instituted a major reform: combined reporting. Combined reporting requires multi-state corporations to...Why Large Corporations Can Do Business in Your State Tax-Free - The "Substantial Nexus" Test
December 15, 2006
The holiday season is in full swing — and chances are you’re buying gifts on the Internet or over the phone, from people you will never meet and companies that will never set foot in your state. These companies are...State Corporate Income Taxes 2001-2003
February 15, 2005
Last September, Citizens for Tax Justice and the Institute on Taxation and Economic Policy published Corporate Income Taxes in the Bush Years, an in-depth look at the taxes that 275 large, profitable corporations paid, or failed to pay, on their...Corporate Income Taxes in the Bush Years
September 15, 2004
This study details which companies have benefitted the most from the decline in corporate taxes over the past three years, and which have been less fortunate. It also measures the effects of loopholes in our corporate tax laws that predated...The Effects of Replacing Most Federal Taxes with a National Sales Tax
September 15, 2004
Recently, there has been renewed discussion of the possibility of replacing most federal taxes with a national retail sales tax. Such an idea was broached in the 1990s, but political interest waned when it was discovered that it would take...Federal Taxation of Earnings Versus Investment Income in 2004
May 15, 2004
How do personal taxes on total investment income compare to taxes on earnings right now? This paper addresses that question. The analysis includes both the individual income tax, which applies in varying degrees to both earnings and investment income, and...Who Pays? A Distributional Analysis of the Tax Systems of All 50 States [2003 Edition]
January 15, 2003
State governments are facing a profound fiscal crisis. In the past year, states have grappled with mounting budgetary shortfalls, as tax revenues have slumped while spending pressures have continued to grow—and these problems will probably get even worse in the...Who Pays? A Distributional Analysis of the Tax Systems of All 50 States [1996 Edition]
June 15, 1996
This study looks at taxes paid by income group, as shares of income, for every state and the District of Columbia. Our primary finding is that by an overwhelming margin, most state and local tax systems take a greater share...The Hidden Entitlements
May 15, 1996
In short, while not all “tax expenditures” are evil, many of them undermine tax fairness, impede economic growth and divert scarce tax dollars away from better uses. If we hope to “reinvent government” to make it more effective and less...