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  • blog   September 18, 2020

    New ITEP Estimates on Biden’s Proposal to Expand the Child Tax Credit

    On Thursday, former Vice President Joe Biden announced that his tax plan would include a provision passed by House Democrats to temporarily expand the Child Tax Credit (CTC), potentially lifting millions of children out of poverty.

    Estimates from ITEP show that this change would benefit most families with children—more than 83 million children live in households that would benefit if this was in effect in 2020—but the most dramatic boost would go to low-income families.

  •   September 17, 2020

    Webinar: What’s Tax Got to Do With It?

    Tax justice is necessary to achieve racial, social and economic justice. We need race-forward tax policies that create opportunity for everyone, demand corporations and the wealthy pay their fair share…
  • blog   September 17, 2020

    Illinois’s Flat Income Tax Amounts to a Tax Subsidy for the Wealthiest Illinoisans that Compounds Income and Wealth Inequalities

    This November, Illinoisans will decide whether to amend the state constitution to allow a graduated income tax. A “yes” vote on the Illinois Fair Tax constitutional amendment will make effective legislation that will replace the current flat tax rate of 4.95 percent with graduated rates that cut taxes for those with taxable income less than $250,000 and institute higher marginal rates on taxable incomes greater than $250,000.

  • news release   September 17, 2020

    New 20-Year Study Provides Insight on How State Tax Systems Worsen Inequality and the Racial Wealth Gap

    A new study finds that over the last 20 years, Illinois’s tax system has effectively sapped $4 billion more from Black and Hispanic communities than it would have under a graduated income tax while also allowing the state’s highest-income (mostly white) households to pay $27 billion less in taxes, the Institute on Taxation and Economic Policy (ITEP) said today.

  • report   September 17, 2020

    Illinois’s Flat Tax Exacerbates Income Inequality and Racial Wealth Gaps

    Flat or graduated personal income taxes have varying effects on the annual individual tax liabilities of taxpayers at different income levels. Less examined is how tax structures affect income inequality and racial wealth gaps. This brief illustrates how Illinois’s historic flat income tax structure compares to the proposed Fair Tax through a multi-year retrospective analysis. It shows that Illinois’s flat income tax in lieu of a graduated rate tax used by most states amounts to a tax subsidy for the wealthiest Illinoisans that compounds income inequality and racial wealth gaps.

  • blog   September 15, 2020

    The Vital Role of Public Programs in Moving People and Families Out of Poverty 

    More families across our nation are struggling to meet their most basic needs. High unemployment, the struggle to put enough food on the table, and an inability to make rent or mortgage payments are widespread. Absent federal intervention, outcomes would have been worse. Over the past few months, federal and state relief measures have mitigated hardship. By putting cash in the hands of those who need it most, lawmakers were able to stabilize some families’ budgets and prop up our fragile economy. With time we will surely glean many lessons from 2020. But the sheer power of targeted assistance is already apparent. 

  • brief   September 15, 2020

    Boosting Incomes and Improving Tax Equity with State Earned Income Tax Credits in 2020

    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 amplified as many states have enacted and expanded their own credits.

  • brief   September 15, 2020

    Tax Justice is…

    Racial justice requires tax justice. Economic justice requires tax justice. Climate and health justice require, yes, tax justice.

  • news release   September 10, 2020

    GOP ‘Skinny Bill’ Rightly Fails, Too Skimpy for This Crisis 

    “Nearly one in eight households don’t have enough to eat. Millions are at risk of eviction. State and local governments are facing revenue shortfalls of well more than $500 billion, leading to inevitable layoffs and cuts to critical services. Knowing that, the Republican Senate put forth a so-called skinny COVID relief package that failed to address these concerns. Too skimpy for this crisis, the bill failed as it should have.”

  • blog   September 3, 2020

    Millionaire Population Swells in Blue States Despite Migration Fearmongering

    Although the 2017 Tax Cuts and Jobs Act has created a slew of problems, it is now clear that a mass migration of top earners out of higher-tax blue states is not one of them.

  • blog   September 3, 2020

    The Rich Are Weathering the Pandemic Just Fine: Tax Them

    Reductions in critical state and local investments, including health care and education, would only exacerbate the economic crisis brought on by COVID-19 and worsen racial and income inequality for years to come. Higher taxes on top earners are among the best options for addressing pandemic-related state revenue shortfalls in the coming months.

  • ITEP Work in Action   August 26, 2020

    South Strong: Racial Equity and Taxes in Southern States

    Southern states have a particularly egregious record on tax equity, rooted partly in racism. Lawmakers baked some of the most egregious and anti-democratic tax policies into southern state constitutions, such…
  • blog   August 25, 2020

    Missed Opportunity: Flimsy Paper Touts Flawed Program

    Republicans continue to tout Opportunity Zones as their main vehicle to assist poor people, most recently with a deeply flawed report from President Trump’s White House Council of Economic Advisors and a mention from Donald Trump Jr. in his opening night convention speech. The report purports to compare—as a way of cutting poverty—tax breaks for investors vs food, cash or health insurance coverage for struggling families.

  • ITEP Work in Action   August 25, 2020

    Keystone Research Center: REPORT: Why Pennsylvania Needs a State Earned Income Tax Credit (EITC)

    If one thing has become clear during the COVID-19 pandemic, it is that workers who do essential things like providing care for the sick, stocking shelves at grocery stores, and…
  • blog   August 18, 2020

    Analysis: Trump’s Proposed Capital Gains Break Almost Exclusively Benefits Top 1 Percent

    On Aug. 13, President Trump pledged to cut the top federal income tax for capital gains to 15 percent. The Institute on Taxation and Economic Policy estimates that 99 percent of the benefits would go to the richest 1 percent of taxpayers. This is unsurprising given that only those with taxable income of nearly half a million dollars are subject to a capital gains tax rate higher than 15 percent.

  • ITEP Work in Action   August 18, 2020

    Revenue for Rhode Island: An Equitable Path Forward

    We propose raising revenue for Rhode Island by adding one new tax bracket for the top 1% of earners – from 5.99% to 8.99% on adjusted gross income above $475,000.…
  • blog   August 17, 2020

    Trump’s Executive Order on Social Security Payroll Taxes Is a Mess 

    President Trump’s executive order that would supposedly allow workers to delay paying Social Security taxes, along with his related public statements, have created a situation that is bizarre even by 2020 standards.  

  • blog   August 14, 2020

    Action (lack thereof) on Economic Aid Reflects Longstanding Anti-Government Agenda

    The biggest danger we face right now is that politicians will fail to get this health crisis under control and Americans will continue to die. The second biggest danger is that elected officials will fail to help families and communities, leading to foreclosures, evictions, and impoverishment—and also torpedoing the economy. With their inaction this week, the Senate seems determined to do both. Hold on everyone, we’re in for a sickening ride.  

  • blog   August 12, 2020

    IRS Rule Leaves the Door Open for Private/Religious School Voucher Donation Schemes, Broader SALT Cap Workarounds

    An IRS regulation released last Friday sanctions a widely derided tax dodge that allows profitable businesses to avoid taxes by sending money to private and religious school voucher funds. It also leaves the door open to a brand of state and local tax (SALT) cap workaround that previously appeared to be on its way out.

  • ITEP Work in Action   August 10, 2020

    Massachusetts Budget and Policy Center: Supporting Racial Equity and a Robust Recovery with a Corporate Income Tax Rate Increase

    By returning the state corporate income tax to pre2010 rates, the Commonwealth could raise $375 million to $500 million a year to help fund a racially equitable, economically just, and…
  • blog   August 5, 2020

    Between the Lines: Amazon Q2 Report Hints It Will Avoid Taxes on This Year’s Record Profit Haul

    The House Judiciary Committee last week held an antitrust hearing to scrutinize Amazon and other tech companies’ growing dominance. A look at the online retail giant’s new quarterly report and past tax avoidance reveals why lawmakers should be equally concerned about how the tax system allows dominant, profitable corporations to avoid most or all federal tax on their profits.

    Amazon, yet again, is poised to pay little or no federal income tax on its record profits, and it appears likely to do so using entirely legal tax breaks for stock options and research and development.

  • blog   July 31, 2020

    Sorry, States: GOP Senate Ignores Need for Federal Relief to State and Local Governments

    During the Great Recession, the most ambitious state revenue-raising efforts closed just 10 percent of shortfalls and most states relied heavily on federal aid and budget cuts to balance their budgets. Of course, states can and should turn to progressive revenue-raising options now, but as the pandemic rages on, the extent of this crisis will become too significant for states and localities to handle on their own. The federal government should step in to help.  

  • blog   July 29, 2020

    Biden’s Minimum Corporate Tax Proposal: Yes, Please Limit Amazon’s Tax Breaks

    A large majority of Americans want corporations to pay more taxes and Democratic presidential candidate Joe Biden has several proposals to achieve that. The newest idea is to require corporations to pay a minimum tax equal to 15 percent of profits they report to shareholders and to the public if this is less than what they pay under regular corporate tax rules. A recent article in the Wall Street Journal quotes several critics of the proposal, but none of their points are convincing.

  • brief   July 29, 2020

    Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform

    Lawmakers in many states have enacted “sales tax holidays” (16 states will hold them in 2020) to provide a temporary break on paying the tax on purchases of clothing, school supplies, and other items. These holidays may seem to lessen the regressive impacts of the sales tax, but their benefits are minimal while their downsides are significant—and amplified in the context of the COVID-19 pandemic. This policy brief looks at sales tax holidays as a tax reduction device.

  • blog   July 29, 2020

    A Cautionary Tale on Sales Tax Holidays During a Pandemic

    Sixteen U.S. states will hold “sales tax holidays” this year. As ITEP’s newly updated brief explains, these events offer dubious benefits at significant public expense even in normal years, problems which are only amplified in the context of the COVID-19 pandemic.

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