Institute on Taxation and Economic Policy
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Gas Taxes Will Rise in 7 States to Fund Transportation Improvements

June 28, 2017 • By Carl Davis

Summer gas prices are at their lowest level in twelve years, which makes right now a sensible time to ask drivers to pay a little more toward improving the transportation infrastructure they use every day. Seven states will be doing this on Saturday, July 1 when they raise their gasoline tax rates. At the same time, two states will be implementing small gas tax rate cuts.

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How Long Has It Been Since Your State Raised Its Gas Tax?

June 28, 2017 • By Carl Davis

Many state governments are struggling to repair and expand their transportation infrastructure because they are attempting to cover the rising cost of asphalt, machinery, and other construction materials with fixed-rate gasoline taxes that are rarely increased.

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Most Americans Live in States with Variable-Rate Gas Taxes

June 28, 2017 • By ITEP Staff

The flawed design of federal and state gasoline taxes has made it exceedingly difficult to raise adequate funds to maintain the nation’s transportation infrastructure. Thirty states and the federal government levy fixed-rate gas taxes where the tax rate does not change even when the cost of infrastructure materials rises or when drivers transition toward more fuel-efficient vehicles and pay less in gas tax. The federal government’s 18.4 cent gas tax, for example, has not increased in over twenty-three years. Likewise, nineteen states have waited a decade or more since last raising their own gas tax rates.

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Explaining our Analysis of Washington State’s Highly Regressive Tax Code

June 22, 2017 • By Carl Davis

Supporters of creating a local personal income tax in Seattle are rightly concerned about the lopsided nature of their state’s tax code. In a 50-state study titled Who Pays?, produced using our microsimulation tax model, we found that Washington State’s tax system is the most regressive in the nation.

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West Virginia Lawmakers Settle on Imperfect Budget, Delay Tax Debate for Next Session

June 21, 2017 • By Aidan Davis

West Virginia’s roller coaster ride of a session is nearing its tumultuous end. In a press conference this morning, Gov. Jim Justice announced that he will let the legislature’s most recent budget bill become law without his signature.

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State Rundown 6/21: Crunch Time for Many States with New Fiscal Year on Horizon

June 21, 2017 • By Meg Wiehe

This week several states rush to finalize their budget and tax debates before the start of most state fiscal years on July 1. West Virginia lawmakers considered tax increases as part of a balanced approach to closing the state’s budget gap but took a funding-cuts-only approach in the end. Delaware legislators face a similar choice, […]

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State Rundown 6/14: Some States Wrapping Up Tax Debates, Others Looking Ahead to Next Round

June 14, 2017 • By ITEP Staff

This week lawmakers in California and Nevada resolved significant tax debates, while budget and tax wrangling continued in West Virginia, and structural revenue shortfalls were revealed in Iowa and Pennsylvania. Airbnb increased the number of states in which it collects state-level taxes to 21. We also share interesting reads on state fiscal uncertainty, the tax experiences of Alaska and Wyoming, the future of taxing robots, and more!

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How to Recover from A Failed Tax Experiment: Part 1

June 13, 2017 • By Lisa Christensen Gee

Gov. Sam Brownback’s tax experiment in Kansas was a failure. His radical tax cuts for the rich eventually had to be partly paid for through tax hikes on low- and middle-income families and also failed to deliver on promises of economic growth. Meanwhile, the tax cuts decimated the state’s budget, diminished its credit rating, and compromised its ability to meet the state’s constitutional standard of adequacy for public education.

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State Rundown 5/31: Budget Woes Spurring Special Legislative Sessions

May 31, 2017 • By ITEP Staff

This week, special legislative sessions featuring tax and budget debates are underway or in the works in Kentucky, Minnesota, New Mexico, and West Virginia, as lawmakers are also running up against regular session deadlines in Illinois, Kansas, and Oklahoma. Meanwhile, a legislative study in Wyoming and an independent analysis in New Jersey are both calling for tax increases to overcome budget shortfalls.

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State Rundown 5/24: Several States Scramble to Finalize Budgets

May 24, 2017 • By ITEP Staff

This week, Kansas lawmakers continued work on fixing the fiscal mess created by tax cuts in recent years, as legislators in Louisiana, Minnesota, Oklahoma, and West Virginia attempted to wrap up difficult budget negotiations before their sessions come to an end, and Delaware lawmakers advanced a corporate tax increase as one piece of a plan to close that state's budget shortfall. Our "what we're reading" section this week is also packed with articles about state and local effects of the Trump budget, new 50-state research on property taxes, and more.

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State Rundown 5/18: Tax Debate Heat Wave Hitting States

May 18, 2017 • By Meg Wiehe

This week saw tax debates heat up in many states. Late-session discovered revenue shortfalls, for example, are creating friction in Delaware, New Jersey, and Oklahoma, while special sessions featuring tax debates continue in Louisiana, New Mexico, and West Virginia. Meanwhile the effort to revive Alaska's personal income tax has cooled off.

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Time to Repeal State Deductions for Federal Income Taxes

May 1, 2017 • By Dylan Grundman O'Neill

Three of the biggest needs facing state policymakers right now are new revenues to fund their priorities in the face of budget shortfalls and federal funding cuts, ways to insulate those revenue streams from unpredictable tax changes at the federal level, and approaches to meet these needs without leaning even more heavily on low- and […]

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All Is Peachy in Georgia, for Now

March 31, 2017 • By Dylan Grundman O'Neill

Georgia lawmakers ended their legislative session Thursday by enacting a few tax credits and smartly choosing not to pass a major income tax cut that had been working its way through the legislature. Policymakers in other states should take note and follow Georgia’s lead by rejecting costly and inequitable flat-tax and other high-income tax cut […]

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What to Watch in the States: State-Federal Relationship Shifting

February 28, 2017 • By Dylan Grundman O'Neill

So far in this series on tax policy topics to watch in 2017, we’ve covered important state debates in areas such as attempts to weaken or eliminate progressive taxes and needed updates to gas taxes and sales taxes. As if those topics weren’t enough to keep state lawmakers up at night, they will be making […]

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States Should Require Combined Reporting of Corporate Income

February 27, 2017 • By Dylan Grundman O'Neill

An important aspect of a 21st century tax code is ensuring that corporate income taxes are easy for corporations to follow, but not easy for them to avoid. As our newly updated policy brief on Combined Reporting of State Corporate Income Taxes explains, “combined reporting” remains an essential tool for states to achieve these goals. […]

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‘IMPROVE’ Act Fails to Improve Tennessee’s Regressive Tax Code

February 13, 2017 • By Dylan Grundman O'Neill

Tennessee Gov. Bill Haslam’s proposal (dubbed the IMPROVE Act) to raise the state’s gas tax while cutting three other taxes would essentially be a tax cut for the state’s wealthiest residents and a tax increase for the lowest-income Tennesseans. While the gas tax is badly in need of an update to fund maintenance and investment […]

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Fiscal Policy Shake-up Comes to Energy States

August 3, 2016 • By Aidan Davis

The sharp decline in oil prices since summer 2014 has allowed consumers to save hundreds of dollars annually at the pump, but it also has left some energy producing states clamoring to come up with policy ideas to make up for lost revenue.

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Weird New Jersey Tax Debates Continue

June 24, 2016 • By Dylan Grundman O'Neill

The New Jersey Legislature is considering a proposal to increase the state’s gas tax but at the same time some lawmakers are insisting that that tax increase be paired with tax cuts for the wealthiest New Jerseyans. Perhaps most bizarre is that the state is considering providing a tax cut for retirement and pension income (a move that would benefit the best-off state residents) while also weighing cuts to the revenue that funds state pensions.

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New Research Shows Millionaires Less Mobile than the Rest of Us

May 26, 2016 • By Carl Davis

A new study released today provides the best evidence yet that progressive state income taxes are not leading to any meaningful amount of “tax flight” among top earners.