ITEP's Research Priorities
Tampa Bay Times: Billions in Profits and No Income Tax Bill? That’s not Fair
July 19, 2019
Amazon made $10.8 billion last year and did not pay a penny in corporate income tax. In fact, it claimed a federal income tax rebate of $129 million. It’s not alone. Sixty profitable Fortune 500 companies avoided all federal income taxes by taking advantage of lax provisions in the 2017 Tax Cuts and Jobs Act. […]
Many States Move Toward Higher Taxes on the Rich; Lower Taxes on Poor People
July 18, 2019 • By Meg Wiehe
Several states this year proposed or enacted tax policies that would require high-income households and/or businesses to pay more in taxes. After years of policymaking that slashed taxes for wealthy households and deprived states of revenue to adequately fund public services, this is a necessary and welcome reversal.
CNBC: Blue states file suit against IRS over rules on SALT workarounds
July 17, 2019
Whether the final rule will ultimately deter people from donating to these funds remains to be seen. “If you’re really passionate about private school vouchers in Georgia, you donate and you still get 100% of your donation back,” Carl Davis, research director at the Institute on Taxation and Economic Policy, told CNBC. “You just won’t […]
Follow the Money to See How Sales Tax Holidays Are Poor Policy
July 17, 2019 • By Dylan Grundman O'Neill
Sales tax holidays are wasteful, misguided policies that will drain more than $300 million of funding away from shared priorities like schools, roads, and health care this year in 16 states, while delivering little benefit to the families that could most use the help. Our newly updated brief reviews recent developments in sales tax holiday policy—including how online sales taxes are changing the picture—and explains why they are a misguided policy option for states. And the story below “follows the money” to show how sales tax holidays are a bad deal for families and communities alike.
Is Your State Holding Sales Tax Holidays in 2019?
July 17, 2019 • By ITEP Staff
Lawmakers in many states have enacted “sales tax holidays” (16 states will hold them in 2019), to provide a temporary break on paying the tax on purchases of clothing, school supplies, and other items. While these holidays may seem to lessen the regressive impacts of the sales tax, their benefits are minimal. ITEP’s policy brief […]
Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform
July 17, 2019 • By Dylan Grundman O'Neill
Lawmakers in many states have enacted “sales tax holidays” (16 states will hold them in 2019), to provide a temporary break on paying the tax on purchases of clothing, school supplies, and other items. While these holidays may seem to lessen the regressive impacts of the sales tax, their benefits are minimal. This policy brief looks at sales tax holidays as a tax reduction device.
Sales Tax Holidays Are Outdated Gimmicks That Have Run Their Course
July 17, 2019 • By ITEP Staff
Just as the very first sales tax holiday for car sales did not fix the auto industry’s challenges, providing consumers a temporary reprieve on sales tax will not address families’ pocketbook concerns.
CommonWealth: Before the T Derailed, its Funding Got on the Wrong Track
July 16, 2019
Overall, funding for the Commonwealth during the last two decades has relied increasingly on sales taxes and regressive user fees, while cutting income tax rates. As a result, we have an upside-down tax system. Effectively, these taxes and fees make lower-income Massachusetts residents pay a higher percentage (10 percent) of their income in state and […]
Chicago Booth Review: Why Some Companies Don’t Maximize Tax Avoidance
July 15, 2019
This conundrum may come as a surprise to those who noticed that Amazon, Netflix, General Motors, and at least 57 other Fortune 500 companies didn’t pay a cent in US income tax last year on a combined $79 billion of profits, according to the Institute on Taxation and Economic Policy. But as Weisbach has put […]
The Hill: 2020 Democrats Push Tax Hike on Wealthy Investors
July 14, 2019
Former President Obama proposed raising capital gains rates for high earners to 28 percent, still short of the top ordinary income tax rate. During the 2016 presidential campaign, Democratic nominee Hillary Clinton proposed increasing capital gains rates for investments held in the medium term but proposed keeping the top long-term rate the same. And Democrats […]
State Rundown Special Edition: Fiscal Year Wrap-Up
July 12, 2019 • By ITEP Staff
We've said it before, and we'll say it again: states don't have to wait for federal lawmakers to make moves toward progressive tax policy. And so far, 2019 has been a good year for equitable and sustainable tax policy in the states. With July 1 marking the start of a new fiscal year for most states, this special edition of the Rundown looks at how discussions in 2019 have been dominated by plans to raise revenue for vital investments, tax the rich and corporations fairly, use the tax code to help workers and families and advance racial equity, and shore…
Does Your State Levy Estate and Inheritance Taxes?
July 12, 2019 • By ITEP Staff
States have been repealing estate taxes since the early 2000s. Now, just 17 states and the District of Columbia (D.C.) levy estate and/or inheritance taxes. Twelve states and D.C. levy estate taxes while six states levy inheritance taxes (Maryland levies both). These taxes have long been used not just to raise revenue for vital public services, but to promote equality of opportunity and reduce the transfer of concentrated wealth from one generation to the next.
Arizona Center for Economic Progress: Using Increased Revenues from Conformity on More Tax Cuts is Fiscally Irresponsible
July 11, 2019
Arizona Should Use Increased Revenues to Prepare for Next Recession Instead of Giving Tax Cuts While a recession does not appear imminent, the current economic expansion began in June 2009 and in July will become the longest economic expansion in American history at 121 months. Given this and the impossibility of predicting when the next […]
MarketWatch: Here’s What 2020 Democratic Candidates Have Said About Universal Basic Income
July 11, 2019
Harris’s proposal would cost more than $270 billion in 2020, according to an estimate by the Washington, D.C.-based Institute on Taxation and Economic Policy. Read more
Missouri’s Creative Approach to Ending the “Race to the Bottom” in State Business Taxes
July 10, 2019 • By Matthew Gardner
Each year, state and local governments spend billions of dollars on targeted tax incentives—special tax breaks ostensibly designed to encourage businesses to relocate, expand or simply stay where they are. A law enacted by the Missouri legislature creates a template for states to work bilaterally to put the brakes on the “race to the bottom” in state business taxes.
Daily Progress: Opinion/Commentary: New IRS Rule Narrows Tax Loophole in Virginia
July 7, 2019
First, people and businesses making stock contributions, rather than cash, may still be able to profit from their donations through avoidance of capital gains taxes. A fix suggested by the Institute on Taxation and Economic Policy is to require taxpayers to pay capital gains tax if they receive a large state tax credit as compensation […]
The Washington Post: States Are Doing It. So Why Hasn’t Congress Increased the Federal Gas Tax?
July 6, 2019
All told, 31 of the 50 states have raised or reformed their motor fuel taxes during the past decade, according to the Institute on Taxation and Economic Policy. What’s more, 22 states now have variable-rate policies in place to make sure that inflation does not erode this crucial revenue stream. In so doing, they are […]
Public News Service: Deadline Today for WA Initiative Requiring Voter Approval for Tax Increases
July 5, 2019
Taxes took center stage because of a finding that Washington has the most regressive tax code in the country. According to the Institute on Taxation and Economic Policy, people in the top 1% pay 3% or less of their income in taxes, while those in the bottom 20% pay nearly 18%. Read more
CT Mirror: Gasoline Taxes Are on the Rise — Just not in CT
July 5, 2019
Twelve states ordered gasoline tax hikes that took effect this week, according to the nonprofit Institute on Taxation and Economic Policy (ITEP). While many policymakers say fuel levies are on the way out, the latest increases mean 31 out of 50 states have raised gasoline taxes at least once this decade, according to ITEP. Read […]
The American Prospect: Without Congressional Input, Trump May Further Widen the Gap Between Rich and Poor
July 3, 2019
“This is just another tax break for rich people,” says Steve Wamhoff, director of federal tax policy at the Institute on Taxation and Economy Policy, who authored a blog post on the policy implications of such a proposal. But even addressing whether the proposal makes economic sense raises serious red flags. Read more
Business Insider: Gas and Diesel Prices Rose at the Worst Possible Time for Drivers in the US and These States Are Being Affected Most
July 3, 2019
For some states, the gas tax increase has been long delayed. Some states have postponed this increase for several years due to the political challenges, Carl Davis, a research director at the Institute of Taxation and Economic Policy, told Business Insider. Davis is an expert in transportation infrastructure funding. “Lawmakers don’t want to take a […]
Which States Have the Highest Tax Rates for Low-income People?
July 3, 2019 • By ITEP Staff
No two state tax systems are the same, but 45 states have one thing in common: Low-income residents are taxed at a higher rate than the top 1 percent. This map shows the effective tax rates for the lowest-income 20 percent in each state--ranging from a high of 17.8 percent in Washington to a low of 5.5 percent in Delaware.
Pacific Standard: Developers Aren’t Reporting How They’re Using Tax Incentives Meant for Low-Income Areas
July 2, 2019
Even for those who have tracked the bill closely, the reporting process remains opaque. “This bill was thrown together so incredibly quickly—there weren’t hearings on it, these types of questions weren’t fleshed out in the way they should have been, so a lot of how this was put together remains a mystery,” says Carl Davis, […]
The Wall Street Journal: From Gas Taxes to Vaping Rules, New State Laws Take Effect Across U.S.
July 2, 2019
Drivers in a number of states will now pay higher taxes on gas as part of a broader push to fund infrastructure improvements. In Illinois, the gas tax has doubled to 38 cents from 19 cents, making it the largest increase for any of these states, according to the Institute on Taxation and Economic Policy, […]
ITEP Summer Reading (and Watching) List
July 1, 2019 • By ITEP Staff
Mercury is rising, presidential primary debates are underway and most state legislative sessions have adjourned for summer. Whether you’re curling up with a good book (or your favorite e-Reader) or looking for a new television show to binge-watch, check out these recommendations on ITEP’s Summer Reading (and Watching) List.
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