President Trump has proposed to eliminate payroll taxes that fund Social Security and Medicare through the end of the year. ITEP estimates that this would cost $843 billion and 65 percent of the benefits would go to the richest 20 percent of taxpayers, as illustrated in the table below.

For Pi Day, we’re doubling down on the pie metaphor to reiterate the compelling case for progressive tax policies to ensure more of us have an opportunity to share a slice of this nation’s economic pie.

Read as PDF Testimony of Lisa Christensen Gee, Director of Special Initiatives, Institute on Taxation and Economic Policy Submitted to: Illinois House Revenue Committee Chairman Zalewski, committee members—thank you for holding this subject matter hearing this morning on the Earned Income Credit (EIC) and its importance for hard working Illinoisans and their families. My name […]

The Trump administration is floating a cut in the Social Security payroll tax as a measure to counteract a potential economic downturn related to the COVID-19 virus. It should go without saying that a public health crisis requires government interventions that have nothing to do with taxes. But even if policymakers want to find ways to stimulate the economy beyond solving the health crisis, the payroll tax cut is not likely to be very effective.

Impact of Including Illinois ITIN Filers in State & Federal EITCs Based on IRS 2015 ITIN Filer Counts and Current EITC Policy Notes: ITIN filer counts represent estimate of EITC eligible ITIN filers in tax year 2015. All $s expressed in 2020. STATE EITC 2015 Assuming Full Participation EITC eligible ITIN Filers: 156,330 State EITC […]

Trump administration officials have reportedly floated the idea of including tax breaks for the airline industry in its package of COVID-19-related stimulus proposals, which would allow airline companies to defer income taxes into the future. This is an odd policy choice since most of the biggest airlines are already using deferral to zero out most or all of their federal income taxes on billions of dollars in profits.

Some problems can only be solved when public officials have the resources to act. Today’s public health crisis is that kind of problem. Unfortunately, the Trump administration’s deep tax cuts leave our health infrastructure knee-capped, just when we need it most.

Excise and sales taxes on cannabis raised more than $1.9 billion in 2019. This represents a jump of nearly half a billion dollars, or 33 percent, compared to a year earlier. These are the findings of an ITEP analysis of newly released tax revenue data from the eight states where legal sales of adult-use cannabis took place last year. 

Alaska’s tax system underwent major changes in the 1970s when oil was found at Prudhoe Bay. Lawmakers repealed the state’s personal income tax (making Alaska the only state ever to do so) and began balancing the state’s budget primarily with oil tax and royalty revenue instead. But as oil prices and production levels have declined, a yawning gap has opened between state revenues and the cost of providing vital public services.

This testimony explains the advantages of the cannabis tax structure proposed in Connecticut’s Senate Bill 16 and offers additional background information as well as ideas for potential changes to the bill.

Anti-tax activists’ convoluted claims that the rich pay too much in taxes broke new ground with an op-ed published last week in the Wall Street Journal. Penned by former Texas Sen. Phil Gramm and John Early, a former official of the Bureau of Labor Statistics, the piece is particularly misleading. The so-called evidence in support of their argument against raising taxes on the rich fails to correctly calculate effective tax rates.

Lawmakers should keep in mind that transportation funding woes can be traced to the federal government’s extremely outdated gas tax rate, which has not been raised in more than 26 years⁠—not even to keep up with inflation.

Now that multiple data points reveal the current administration, which promised to look out for the common man, is, in fact, presiding over an upward redistribution of wealth, the public is being treated to pasta policymaking in which advisors are conducting informal public opinion polling by throwing tax-cut ideas against the wall to see if any stick. But the intent behind these ideas is as transparent as a glass noodle.

One of the biggest problems with the U.S. tax code in terms of fairness is that investment income, which mostly flows to the rich, is taxed less than the earned income that makes up all or almost all of the income that working people live on.

The federal Earned Income Tax Credit (or EITC) lifts millions out of poverty each year, but it is not created equal for everyone. Childless workers under 25 and over 64 receive no benefit from the existing federal credit. In the absence of immediate federal action, states have led–and continue to lead–the way.

For 45 years, the federal Earned Income Tax Credit (EITC) has benefited low- and moderate-income workers. Yet, throughout its history, the EITC has provided little or no benefit to workers without children in the home—a group that includes noncustodial parents whose children live the majority of the year with another parent.

Read as PDF Testimony of Kamolika Das, State Policy Analyst, Institute on Taxation and Economic Policy Submitted to: Ways and Means Committee, Maryland General Assembly Thank you for this opportunity to submit testimony. My name is Kamolika Das, and I represent the Institute on Taxation and Economic Policy (ITEP), a non-profit, non-partisan research organization that […]

State lawmakers have plenty to keep them busy on the tax policy front in 2020. Encouraging trends we’re watching this year include opportunities to enact and enhance refundable tax credits and increase the tax contributions of high-income households, each of which would improve tax equity and help to reduce income inequality.