March 6, 2019
There is significant room for improvement in state and local tax codes. State tax codes are filled with top-heavy exemptions and deductions and often fail to tax higher incomes at higher rates. States and localities have come to rely too heavily on regressive sales taxes that fail to reflect the modern economy. And overall tax collections are often inadequate in the short-run and unsustainable in the long-run. These types of shortcomings provide compelling reason to pursue state and local tax reforms to make these systems more equitable, adequate, and sustainable.
March 22, 2019
A 2019 ITEP analysis found that Black and Latinx households are overrepresented in the lowest-income quintiles; while they represent about 22 percent of overall tax returns, they account for 30 percent of the poorest quintile of taxpayers.
March 15, 2019
On Thursday, Representative Lloyd Doggett and Senator Sheldon Whitehouse announced that they are reintroducing the “No Tax Breaks for Outsourcing Act.” Our international corporate tax rules have been a mess for a long time, and Tax Cuts and Jobs Act (TCJA) failed to resolve the problems. The old rules and the new rules under TCJA both tax offshore corporate profits more lightly than domestic corporate profits, but in different ways. The No Tax Breaks for Outsourcing Act would create rules that tax domestic profits and foreign profits in the same way.
ITEP Work in Action
March 15, 2019
Millionaires’ taxes can help address this problem. They can raise substantial revenue for public services by asking more of those at the top, a group that’s disproportionately white. White families are three times likelier than Black and Latinx families to be in the top 1 percent, according to a report by Prosperity Now and the Institute on Taxation and Economic Policy.
March 14, 2019
More than three billion dollars could be raised under a major progressive tax plan proposed by Illinois Gov. J.B. Pritzker this week, the point being to simultaneously improve the state’s upside-down tax code and address its notorious budget gap issues. One state, Utah, may already be looking at a special session to revisit the sales tax reform debate that ended this week without resolution, in contrast to Alabama and Arkansas, where leaders finally resolved years-long debates over gas taxes and infrastructure funding. And lawmakers in four states – California, Florida, Minnesota, and North Carolina – introduced legislation to expand or enact Earned Income Tax Credits (EITC).
March 12, 2019
In December 2017, federal lawmakers hastily enacted the Tax Cuts and Jobs Act. So rushed was its passage that provisions of the legislative text were scrawled in the margins. Scroll through this timeline for an in-depth look at the Tax Cuts and Jobs Act and the impact since its passage.
Poorest 20 percent pay a 50 percent higher effective state and local tax rate than the top 1 percent ITEP’s sixth edition of Who Pays? A Distributional Analysis of the Tax System in All 50 States finds that most state and local tax systems continue to tax low- and middle-income households at higher rates than the wealthy.
State policy toward cannabis is evolving rapidly and lawmakers have a responsibility to structure these taxes properly in light of the best available evidence. As more states consider legalization, a new ITEP report analyzes the past five years of cannabis taxation and provides policy recommendations for states moving forward.
America has long needed a more equitable tax code that raises enough revenue to invest in building shared prosperity. Any true federal tax reform plan would, at a minimum, include these revenue-raisers, among other provisions.
A federal wealth tax on the richest 0.1 percent of Americans is a viable approach for Congress to raise revenue and is one of the few approaches that could truly address rising inequality. The goals of raising revenue and addressing inequality will be difficult to achieve if federal tax policy continues to focus on taxing income almost exclusively.
While ITEP has produced quantitative and qualitative research on class-based tax inequities, we, until recently, have ignored how tax policies affect communities based on race. Solely examining the tax law in the context of class misses a bigger-picture story about how the nation’s public policies not only perpetuate widening income and wealth inequality, they also preserve historic and current injustices that continue to allow white communities to build wealth while denying the same level of opportunity (and often suppressing it) to communities of color.
Whether it’s at the state or federal level, ITEP produces careful research and in-depth analyses of tax policies, and provides a voice for working people in tax policy debates. State advocates, policymakers and media often use our work to inform public discourse on current and proposed tax policies.
ITEP’s federal policy resources provide quantitative and qualitative research and analysis on current tax policies, proposals, and reform options. Its distributional analyses highlight how tax proposals will affect low-income, middle-class and wealthy Americans nationally and in all 50 states.
State taxes pay for essential public services, from education to health care. But the ideal design of a tax system is complicated. ITEP’s state policy resources offer insights into central issues, including the impact of state tax systems on individuals, families, and businesses. Its work also analyzes the sustainability of revenue sources over time.
Corporate Tax Research
ITEP’s corporate tax research examines the tax practices of Fortune 500 companies. Besides its corporate study on average effective tax rates paid by the nation’s largest, most profitable corporations, ITEP produces research on subjects such as offshore cash holdings, tax haven abuse, executive stock options and other tax loopholes.
Americans have long wanted progressive taxes but few, if any, lawmakers publicly backed this view. What’s happening now isn’t a shift in public opinion, rather it’s Washington finally catching up with the American people.