In Florida, a new calculator examines the local impacts of Amendment 3, which would lead to the elimination of non-school property taxes in the state and threatens severe impacts on local services.
As the Iran War continues to cause gas prices to rise across the country, lawmakers are stepping on the accelerator instead of pumping the brakes on costly and ineffective proposals to suspend the gas tax ahead of the November election. In Indiana, Gov. Mike Braun extended the state’s gas tax suspension for another 30 days. Next door, in Ohio, Gov. Mike DeWine signed legislation that would suspend the state’s gas tax for 90 days, costing the state $725 million. And in North Carolina, lawmakers convened for a special session and approved legislation that would suspend the gas tax until December, at the cost of $360 million.
Major State Tax Proposals and Developments
- A new calculator released by the Florida Policy Institute demonstrates the local impact of FLORIDA’s Amendment 3, which would increase the state’s homestead exemption on non-school property taxes and index it to inflation, effectively paving a path for elimination of those property taxes. The calculator – which is powered by ITEP – allows Floridians to see the amendment’s potential impact on local services such as hospitals, libraries, and more. – NEVA BUTKUS
- NORTH CAROLINA passed legislation during a special session to suspend the gas tax until December, at an estimated cost to the state of $360 million. The legislation passed both chambers of the General Assembly nearly unanimously, with only one senator opposing the bill. – MILES TRINIDAD
- OHIO Gov. Mike DeWine signed legislation suspending the state’s gas tax for 90 days amid rising gas prices due to the Iran War. Under the bill, $725 million will be appropriated from the state’s general revenue fund to cover lost revenue from the gas tax suspension. The legislation comes after both major party gubernatorial candidates called for the tax holiday last week. – MILES TRINIDAD
State Roundup
- CALIFORNIA tightened its definition of a resident for sales tax purposes to further limit Californians registering their vehicles out of state to evade taxes. Meanwhile, the state’s Franchise Tax Board is preparing to implement the proposed wealth tax, Prop 40, which will be voted on this November. In California, residency is determined not only by days in the state, but other factors including someone’s “center of life” which has led to disputes.
- Cook County, ILLINOIS voters will consider a millionaires’ tax referendum on the ballot this November. The nonbinding measure will ask Cook County residents if they approve of a 3 percent surcharge on annual income over $1 million for property tax cuts and funding for public schools.
- INDIANA Gov. Mike Braun renewed the state’s gas tax suspension for an additional 30 days. The executive order will also allow farmers and timber harvesters to use untaxed diesel fuel, sometimes referred to as red-dyed diesel, previously reserved for off-road usage in construction equipment.
- NEVADA schools are struggling to make ends meet and state leaders are taking notice. Gov. Joe Lombardo signed an executive order to send some emergency funds to school districts, and a recent order ending property tax abatements for data centers is slowing the bleeding as well. Lawmakers are considering making that tax abatement prohibition permanent while also looking to other sources for new revenues, such as property tax and sales tax changes. A progressive income tax would help with these funding issues while improving the state’s extremely regressive tax system but will require a multi-year effort.
- The OKLAHOMA Supreme Court ruled that a ballot measure aiming to eliminate property taxes on homesteads entirely by 2029 is unconstitutional, and it will not appear on the November ballot. Meanwhile, the Oklahoman endorsed a “no” vote on a different measure – State Question 847 – which would lower the growth caps on property taxes.
- The revenue picture in WASHINGTON state is brightening, particularly thanks to an increase in projected revenue from the state’s highly popular new millionaires’ tax which is set to go into effect in 2028. But the work is far from over, as a shortfall of hundreds of millions is still forecasted for the upcoming fiscal year, an even larger shortfall looms in the budget after that, and an effort to repeal the millionaires’ tax before it takes effect is still in play.
- WYOMING realtors have announced their opposition to Proposition 1, a measure that would exempt half of a primary residence from property tax. The realtors say they are opposed because the cut has no offsetting revenue and would damage necessary local services. The Wyoming Taxpayers Association also announced its opposition.
What We’re Reading
- In a recent guest post, scholars Brian Galle, David Gamage, and Darien Shanske respond to common and overstated objections to California’s Prop 40. Meanwhile, experts at the California Budget and Policy Center lay out the implications of Proposition 41 and 42. Both measures are designed to undermine Proposition 40 and other revenue raising efforts.
- A recent ITEP piece highlights the four new states that raised taxes on the wealthy and explains how this progressive revenue raisers are one of the best tools states can use to advance racial and economic justice.
- A new joint brief analyzes a proposed federal rule that would limit eligibility of the refundable portions of four federal tax credits, including the Earned Income Tax Credit and Child Tax Credit. The rule would primarily impact lawfully present immigrants authorized to work in the United States and their children – the vast majority of whom are U.S. citizens. The brief was coauthored by the Institute for Equity in Child Opportunity & Healthy Development at Boston University and the Center on Poverty and Social Policy at Columbia University. ITEP also submitted public comment in opposition to the rule.
If you like what you are seeing in the Rundown (or even if you don’t) please send any feedback or tips for future posts to Aidan Davis at aidan@itep.org. Click here to sign up to receive the Rundown via email.
