Institute on Taxation and Economic Policy

Tax cuts have been proposed in many states already this year, but amid so much uncertainty, it remains to be seen how successful those efforts will be. This week saw one dangerous, largely regressive tax cut proposal move in Georgia, new budget proposals in Louisiana and New Jersey, a new plan to close West Virginia‘s […]

blog  

Return of the Moderate: A Kansas Force Awakens

February 28, 2017 • By Lisa Christensen Gee

Before the tea party wave of 2010 that brought Gov. Sam Brownback to power and inspired the disappointing “real life experiment” in tax policy, Kansas was primarily governed by a moderate bipartisan coalition. One thing the last few weeks in the Kansas capital has clearly demonstrated is that this coalition is back and they mean […]

Evidence Counts: A Marriage Not Made in Heaven: A State EITC Without an Income Tax

February 28, 2017

Last Friday, the Senate Select Committee on Tax Reform explored the idea of amending SB 335 to include a version of a refundable state Earned Income Tax Credit. As noted previously, SB 335 would replace the personal and corporate income tax, along with the sales and use tax, with a general consumption tax of 8 […]

blog  

State Rundown 2/23: Regressive Tax Proposals Multiplying

February 23, 2017 • By ITEP Staff

This week saw a nearly successful attempt to right the fiscal ship in Kansas; regressive tax proposals introduced in WestVirginia, Georgia, and Missouri; ongoing gas tax fights in Indiana, South Carolina, and Tennessee; and further tax and budget wrangling in Illinois, New Mexico, Oklahoma, and beyond. — Meg Wiehe, ITEP State Policy Director, @megwiehe Both […]

Kentucky Center for Economic Policy: The Math Behind Ed Choice Tax Credit Fails Many Tests

February 21, 2017

Today in the House Education Committee legislators are hearing discussion of House Bill 162, a proposal to create a so-called Education Choice tax credit in Kentucky. This proposal does not target low- and moderate-income students as suggested; is expensive, taking resources away from public schools and other investments; and provides an excessively large credit under […]

Evidence Count: Governor Justice’s Tax Plan: Who Pays?

February 21, 2017

Governor Jim Justice has not introduced any tax measures yet, but in his State of the State Address and his executive budget  there are plans to enact several tax increases to close the Fiscal Year 2018 budget gap of $500 million and address the state’s declining road fund that pays for highway construction, maintenance, and road […]

Evidence Counts: Replacing Income Taxes with a General Consumption Tax is Radical and Regressive (SB 335)

February 20, 2017

Senate leadership introduced SB 335 which would abolish the personal income tax and sales and use tax, phase out the corporate income tax, lower the severance tax, and replace these taxes with an 8 percent broad-based general consumption or sales tax. While it is unclear whether this tax shift would be revenue neutral, it would dramatically […]

West Virginia Center on Budget & Policy: What Would Eliminating the Income Tax Mean for West Virginia?

February 17, 2017

Eliminating the income tax is a strategy that has been tried over and over in other states with little or nothing to show, other than revenue erosion that brings cuts in support for schools, transportation and other true building blocks of broad prosperity. A better course for West Virginia would be to reform the tax […]

West Virginia Center on Budget & Policy: Replacing Income Tax with Sales Tax is a Boon for the Wealthy

February 15, 2017

Scale back income tax exemptions – Every taxpayer regardless of income receives a $2,000 exemption for each dependent. Phase it out between $150,000-$200,000, and eliminate it for those over $200,000, and it would increase revenue by an estimated $10 million. PowerPoint presentation available here

This is the fourth installment of our six-part series on 2017 state tax trends. The introduction to this series is available here.   State lawmakers often find themselves looking for ways to raise revenue to fund vital public services, fill budget gaps, or pay for the elimination or weakening of progressive taxes. Lately, that search has […]

This week we are following a number of significant proposals being debated or introduced including reinstating the income tax in Alaska and eliminating the tax in West Virginia, establishing a regressive tax-cut trigger in Nebraska, restructuring the Illinois sales tax, moving New Mexico to a flat income tax and broader gross receipts tax, and updating […]

Kansas Action for Children: KAC Testimony to the Senate Assessment and Taxation Committee in Support of Senate Concurrent Resolution 1604

February 15, 2017

The high food sales tax hurts Kansas families. Food is a basic necessity for Kansas’ families. According to the Institute on Taxation and Economic Policy, the state’s increasing reliance on sales tax hurts Kansas’ poorest residents. The lowest 20% of  income earners in Kansas pay an average of 11.1% of their income in state and […]

Detroit Free Press: House Panel Approves Gradual Elimination of Income Tax

February 15, 2017

And Gilda Jacobs, executive director of the Michigan League for Public Policy, said that according to a study by the Institute on Taxation and Economic Policy, the tax relief for the lowest earners–less than $22,000 a year–would be only $16 per year while the wealthiest earners–more than $484,000–would get a tax benefit of $3,700 a […]

West Virginia Center on Budget & Policy: Income Tax Cuts and Shifting to Sales Tax a Poor Strategy for Growing West Virginia’s Economy

February 15, 2017

Even though faced with a $600 million budget deficit, some West Virginia lawmakers are proposing reducing or eliminating the state’s income tax, and replacing that lost revenue with an increase in the sales tax. This plan is unlikely to produce the economic growth, instead it dramatically shifts tax responsibility responsibilities from the wealthy onto low […]

ITEP Testimony Regarding Kansas Senate Bill 188

February 14, 2017

ITEP analysis of Kansas tax changes enacted between 2012 and 2015 shows the state lost over $1 billion in revenue annually from changes to its personal income tax, including lowering income tax rates and exempting business pass-through income from taxation (see Figure 1). While the state subsequently made up some of these revenue losses through […]

Policy Matters Ohio: Ohio Nees a Strong Income Tax

February 10, 2017

Ohio’s income tax is the only major tax that is based on ability to pay. This principle was embraced by the founders of our democracy, such as Thomas Jefferson, as well as by the intellectual father of capitalism, Adam Smith. As your taxable income goes up, you pay a higher rate; for instance, income between […]

DC Fiscal Policy Institute: Revenue: Where DC Gets Its Money

February 9, 2017

The DC government collects revenue in a variety of ways from its residents, businesses, and the federal government.  These revenues are used to fund the wide array of services provided by the District, from schools to health care to libraries to road construction.  The DC government collected about $10.5 billion in revenue in fiscal year […]

For more than four decades, supply-side ideologues have promoted the myth that tax cuts for the wealthy are self-financing and the benefits eventually trickle down to everyone else, despite real-life evidence that tax cuts for the rich benefit the rich. Not even the reality of 40 years of widening income inequality or the current economic […]

This week we bring news of Kansas lawmakers attempting to fix ill-advised tax cuts that have wreaked havoc on the state’s budget and schools, while their counterparts in Nebraska and Idaho debate bills that would create similar problems for their own states, as well as tax cuts in Arkansas that were proven unaffordable within one […]

Policy Matters Ohio: Kasich Budget Shifts Taxes Again

February 7, 2017

New analysis for Policy Matters Ohio by the Institute on Taxation & Economic Policy, a national nonprofit research institute with a sophisticated model of the state and local tax system, shows the governor’s tax plan raises taxes for many Ohioans. It reduces state income tax rates and cuts the number of brackets from nine to five.

ITEP Testimony Regarding Kansas Senate Bill 2237

February 7, 2017

ITEP analysis of Kansas tax changes enacted between 2012 and 2015 shows the state lost over $1 billion in revenue annually from changes to its personal income tax, including lowering income tax rates and exempting business pass-through income from taxation (see Figure 1). While the state subsequently made up some of these revenue losses through […]

blog  

State Rundown 2/1: 2017 State Tax Debates Getting Real

February 1, 2017 • By ITEP Staff

This week’s Rundown brings news of tax cuts passed in Arkansas and advanced in Idaho, proposals to exempt feminine hygiene products from sales taxes in Nevada and Michigan, revenue shortfalls forcing tough choices in Louisiana and Maine, and more governors’ state of the state addresses and budget proposals setting the stage for yet more tax […]

Kentucky Center for Economic Policy: Refugees, Immigrants Important to Kentucky and the Economy: An Overview of the Research

February 1, 2017

From the promise to build a wall paid for by tariffs on Mexican imports and uncertainty about what will happen to DACA (which allows undocumented immigrants whose parents brought them to the U.S. as children to apply for a renewable reprieve from deportation), to a 120-day ban on refugee admissions and an indefinite ban for […]

Georgia Budget & Policy Institute: Georgia Stands to Lose Millions from Crackdown on Young Immigrants

February 1, 2017

The potential for harsher federal immigration policies under the new presidential administration poses special concern for young Georgians whose parents brought them to the United States as children. A new federal crackdown threatens to wreak havoc in the lives of tens of thousands of young Georgians who now enjoy some limited legal protections that allow […]

Crain’s Detroit Business: In Bid to Eliminate Michigan Income Tax, Fears of Another Kansas

February 1, 2017

According to a 2015 report by the Institute on Taxation and Economic Policy, a nonpartisan research organization, five states with no income tax are ranked among the top 10 most regressive in tax structure. In reaching its conclusion, the report compared the share of personal income paid at different income levels in state and local […]