September 30, 2019
“The stock market is a market where stocks, a type of investment that represents ownership in a company are traded,” said Jessica Schieder, a federal tax policy fellow at the Institute on Taxation and Economic Policy. “The stock market is where people make bets on what’s going to happen in the economy.” Listen
September 30, 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 earlier. “You just […]
September 27, 2019 • By Stephanie Clegg
Income inequality has reached its highest level since the U.S. Census Bureau began tracking the measure more than 50 years ago, according to recent data. While recent Census data show modest increases in median household income and average hourly wages—numbers anti-tax politicians and pundits have used to deny rising inequality—a deeper look at some of the latest numbers reveals a decades-long trend of widening economic inequality.
September 26, 2019 • By ITEP Staff
Lawmakers in Michigan and New Hampshire made progress toward enacting their state budgets, though Michigan may yet end up in a government shutdown. Leaders in Wyoming advanced a proposal to create a limited tax on large corporations to raise some revenue and add a progressive element to their state’s tax code. Georgia agencies are forced to recommend their own funding cuts amid state income tax cuts. And business tax subsidies are looking particularly bad in Maryland, where subsidy money has been handed out without verification that companies were creating jobs, and New Jersey, where a false threat to leave the…
September 26, 2019 • By Carl Davis
A well-designed carbon tax package—that is, levied at a sufficiently high rate and paired with equitable offsets for lower- and middle-income families—could improve both our environment and the fairness of our tax system.
September 26, 2019 • By Guest Blogger
Lawmakers in Maine this year took bold steps toward making the state’s tax system fairer. Their actions demonstrate that political will can dramatically alter state tax policy landscape to improve economic well-being for low-income families while also ensuring the wealthy pay a fairer share.
September 26, 2019
“We’re seeing such a dramatic change in the debate,” Steve Wamhoff, the director of federal tax policy at the left-leaning Institute on Taxation and Economic Policy, said. “There is a lot of agreement on the principle of wealth tax, though the average American may not differentiate between the two plans.” Sander’s plan could come with […]
September 26, 2019 • By Aidan Davis
This report presents a comprehensive overview of anti-poverty tax policies, surveys tax policy decisions made in the states in 2019 and offers recommendations that every state should consider to help families rise out of poverty. States can jump start their anti-poverty efforts by enacting one or more of four proven and effective tax strategies to reduce the share of taxes paid by low- and moderate-income families: state Earned Income Tax Credits, property tax circuit breakers, targeted low-income credits, and child-related tax credits.
September 26, 2019 • By Aidan Davis
Sales taxes are one of the most important revenue sources for state and local governments; however, they are also among the most unfair taxes, falling more heavily on low- and middle-income households. Therefore, it is important that policymakers nationwide find ways to make sales taxes more equitable while preserving this important source of funding for public services. This policy brief discusses two approaches to a less regressive sales tax: broad-based exemptions and targeted sales tax credits.
September 26, 2019 • By Aidan Davis
State lawmakers seeking to make residential property taxes more affordable have two broad options: across-the-board tax cuts for taxpayers at all income levels, such as a homestead exemption or a tax cap, and targeted tax breaks that are given only to particular groups of low- and middle-income taxpayers. This policy brief surveys the advantages and disadvantages of the circuit breaker approach to reducing property taxes.
September 26, 2019 • By Aidan Davis
The high cost of quality child care is a budget constraint for many working families and particularly daunting for parents who are working but earning low wages. Most families with children need one or more incomes to make ends meet which means child care expenses are an increasingly unavoidable and unaffordable expense. This policy brief examines state tax policy tools that can be used to make child care more affordable: a dependent care tax credit modeled after the federal program and a deduction for child care expenses.
September 26, 2019 • By Aidan Davis
The Earned Income Tax Credit (EITC) is a policy designed to bolster the incomes of low-wage workers and offset some of the taxes they pay, providing the opportunity for families struggling to afford the high cost of living to step up and out of poverty toward meaningful economic security. The federal EITC has kept millions of Americans out of poverty since its enactment in the mid-1970s. Over the past several decades, the effectiveness of the EITC has been magnified as many states have enacted and later expanded their own credits.
September 25, 2019 • By Steve Wamhoff
Earlier this year, Sen. Elizabeth Warren proposed a federal wealth tax on a handful of U.S. households with the highest net worth. Sen. Bernie Sanders has just announced his own wealth tax proposal, which is similar to Warren’s. A few other presidential candidates say they support the concept although they have not provided any details. Here's what you need to know about the potential for a federal wealth tax.
September 24, 2019
According to an analysis by the Institute on Taxation and Economic Policy, low-income families spend about three quarters of their income on items that are subject to sales taxes while middle-income families spend about half and the most wealthy households just about a sixth. Mitchoff acknowledged that combined with the Measure J half-cent tax that […]
September 24, 2019
In a 2017 analysis, the Institute on Taxation and Economic Policy took a look at how “scholarship tax credit” programs impacted the budgets of the 17 states where they had been put into effect. Taken together, these states were diverting more than $1 billion per year from the public coffers toward private schools via tax […]
September 20, 2019 • By Matthew Gardner
It was this side of last month that the Business Roundtable made headlines by announcing its new vision of the purpose of a corporation. More than 180 corporate leaders signed the statement, which declared corporations will prioritize the communities in which they work—instead of shareholder value. But for some corporations, the Business Roundtable statement is yesterday’s news, and they are commencing with business as usual.
September 19, 2019
Meanwhile, some countries are heading in precisely the wrong direction: over the next five years, the UK’s oil industry is set to receive $6.2 billion more than it pays in taxes, thanks to generous government support. In the US, Republicans’ tax reforms in 2017 handed $25 billion to oil and gas companies, according to the […]
September 19, 2019 • By Steve Wamhoff
One of the most glaring sources of unfairness in the federal tax code are rules that tax capital gains, which mostly go to the rich, less than wages and other types of income that most of us depend on. The capital gains tax breaks have for decades been comfortably ensconced behind trenches filled with special interests who would defend them until the end. But the end is now conceivable.
September 18, 2019
The Institute on Taxation and Economic Policy reports that in 2017, such workers paid $1.1 billion in personal income taxes, which can often help strengthen an immigration case. Read more
September 18, 2019
Booker’s capital gains tax plan is aimed at richer residents. Currently, capital gains are taxed at 23.8 percent compared to a top rate for earned income of 37 percent. And 78 percent of capital gains income goes to the richest 1 percent of taxpayers, according to the Institute on Taxation and Economic Policy, a progressive […]
September 17, 2019 • By Steve Wamhoff
New estimates from ITEP show that Julián Castro’s refundable tax credit proposal would mostly benefit the bottom 60 percent of households and would have a cost ($195 billion in 2020) that places it roughly in the middle of the different tax credit proposals that Democrats have offered over the past several months.
September 17, 2019 • By ITEP Staff
The Working Families First Credit proposal would increase the CTC from $2,000 to $3,000 and remove the limits on refundability that prevent many lower-income families from receiving the entire credit and expand the EITC by increasing the rate at which earnings are credited and it would provide a larger increase for childless workers. View the distributional analysis.
September 16, 2019 • By ITEP Staff
Seven states currently allow for the legal, taxable sale of recreational cannabis. The above map shows per capita revenue collections from excise and sales taxes on cannabis during the second quarter of 2019, the most recent period for which data are available in every state. The most lucrative cannabis market in the country, from a tax revenue perspective, is in Washington State where the 46 percent combined tax rate applied to cannabis is the highest in the country. Collections in California and Massachusetts, by contrast, remain low as these states are still in the early stages of establishing their legal…
September 16, 2019 • By ITEP Staff
A federal wealth tax on the richest 0.1 percent of Americans is a viable approach for Congress to raise revenue and address economic inequality. This new video from ITEP makes the case for a federal wealth tax.
September 13, 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