Institute on Taxation and Economic Policy (ITEP)

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IRS Cooperation with ICE Will Damage Public Trust, Putting Tax Revenues in Jeopardy

• By Marco Guzman

Attempts by the Department of Homeland Security to secure private information from the IRS on people who file taxes with an Individual Taxpayer Identification Number is a violation of federal privacy laws that protect taxpayers. It is also a change that could seriously damage public trust in the IRS, which could jeopardize billions of dollars in tax payments by hardworking immigrant families.

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State Rundown 4/9: A Progressive Pushback

• By ITEP Staff

Residents and state lawmakers across the country are pushing back against anti-tax measures and are looking for ways to protect revenue and advance proposals that would raise revenue in progressive ways. This comes at a time when federal policy brings significant risks for state tax revenue.

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Philadelphia Mayor’s Proposal to Cut Business Taxes is Illogical and Imprudent

• By Kamolika Das

Mayor Cherelle L. Parker’s proposal to cut the city’s business income and receipts tax (BIRT), based off the Philadelphia Tax Reform Commission’s recommendation, is illogical and imprudent. This is more than the city spends each year on homelessness services, public health, the streets department, and countless other programs that directly benefit residents.

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What the Wall Street Journal Editorial Board Got Wrong About Tesla’s Tax Avoidance

• By Matthew Gardner

Tesla’s income tax avoidance is still in the news, and that’s a good thing.

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Senate Republicans Rig Congressional Rules to Make Their Tax Cuts Appear Cost-Free

• By Steve Wamhoff

This week, members of Congress are arguing about whether extending Trump’s 2017 tax cuts would cost trillions of dollars over a decade or cost nothing.

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State Rundown 4/3: Amidst Tariff Uncertainty, State Lawmakers Talk Taxes

• By ITEP Staff

While all eyes are on the Trump administration’s tariffs on foreign imports, state lawmakers are moving forward with a mix of deep, regressive tax cuts and progressive revenue raisers.

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Celebrating 50 Years of the Earned Income Tax Credit

• By Neva Butkus

This week, we celebrate 50 years of the federal Earned Income Tax Credit (EITC) and the impact it's had on millions of workers and families. In 2023 alone, the latest year of available data, the federal EITC alongside the refundable portion of the Child Tax Credit lifted 6.4 million people and 3.4 million children out of poverty.

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State Rundown 3/26: Lawmakers Navigate Shortfalls, Potholes, and Pitfalls

• By ITEP Staff

State lawmakers around the country are navigating a range of potential hazards this week. Leaders in Maryland and Washington are facing budget holes but are smartly working to get out of them through progressive taxes on those with the most ability to pay. Both North Dakota and Washington state are looking to fill literal potholes […]

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Why Americans Are Right to Be Unhappy About Corporate Tax Avoidance

• By Matthew Gardner

If lawmakers wanted to reduce income inequality and racial inequality, shutting down or at least limiting corporate tax breaks would be one option to achieve that goal. Unfortunately, President Trump and the current Congress show little interest in this and may even move in the opposite direction by introducing new corporate tax breaks.

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Two Ways a 2025 Federal Tax Bill Could Worsen Income and Racial Inequality

• By Joe Hughes

Two parts of Trump’s 2017 tax law that are particularly expensive and beneficial to the richest individuals are the changes in income tax rates and brackets and the special deduction for “pass-through” business owners. Lawmakers should not extend these provisions for high-income households past the end of this year, when they are scheduled to expire.  

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Tip Exemptions Have No Place in State Income Tax

• By Eli Byerly-Duke, Nick Johnson

Creating a special tax break for tipped income – as at least 20 states are considering this spring – would harm state budgets, encourage tax avoidance, and fail to reach the vast majority of low- and middle-income workers.

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State Rundown 3/20: It’s March, Welcome to Tax Policy Madness

• By ITEP Staff

March Madness kicks off today and the pressure is on as many states’ legislative sessions are nearing the final buzzer. Some state lawmakers are seemingly competing for the title of most regressive state tax policies while others are looking to lift up best practices for more equitable outcomes.   The Mississippi legislature landed on a […]

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Circuit Breakers Are a Better Option for Property Tax Relief

• By Brakeyshia Samms

To curb the impact of property taxes on working families, lawmakers should improve or implement a property tax circuit breaker program. The program works like this: when families are overloaded with their property taxes, the circuit breaker kicks in and helps alleviate the pressure these taxes put on family budgets.

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State Rundown 3/12: Last-Minute Tax Cut Mayhem and New Progressive Revenue Raisers

• By ITEP Staff

A bevy of tax cut proposals sprung to life this week while others were signed into law. In Kentucky, lawmakers are working to make it easier for the legislature to enact income and business tax cuts. The governor in Idaho signed into law a personal and corporate income tax cut.

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State Rundown 3/6: In the Shadow of Chaotic Federal Policymaking States Seek to Tax the Top, Cut Taxes

• By ITEP Staff

Proposals from governors in both New Jersey and Wisconsin include provisions to tax high-income earners. Meanwhile, several major tax proposals are advancing in the great plains, with Iowa considering a major cut to unemployment taxes, North Dakota advancing new benefits for private schools, and Wyoming cutting property taxes. The District of Columbia is facing a more than a $1 billion revenue shortfall over the next three years, compared to previous estimates, and a mild recession due…

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Trump’s Address to Congress Obscures His Actual Tax Agenda

• By Amy Hanauer

In last night’s address to Congress, President Trump spent more time insulting Americans, lying, and bragging than he did talking about taxes. But regardless of what President Trump and Elon Musk talk about most loudly and angrily, there is one clear policy that they and the corporations and billionaires that support them will try hardest […]

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A Well Targeted Federal Renter Credit Could Help Reduce Wealth Gaps

• By Brakeyshia Samms

While lawmakers often speak about income inequality, less attention is paid to wealth inequality. Wealth is distributed even more unequally than income in the U.S. in ways that reinforce racial divides, leave some households with too little to handle unexpected expenses, and enable some households to pass down enormous intergenerational wealth. A renter tax credit is one tool lawmakers can use to reduce wealth inequalities both within racial and ethnic groups and between these groups. As…

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Mississippi Considers Deep Tax Cuts Amidst Budget and Economic Uncertainty

• By Neva Butkus

At a time when states across the country are forecasting deficits or anticipating slowing revenue growth, Mississippi lawmakers are debating deeply regressive and expensive tax cuts that would overwhelmingly benefit their state’s richest residents.

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State Rundown 2/26: House Budget Plan Could Further Strain State Budgets

• By ITEP Staff

States would be wise to keep a close eye on happenings in Washington, D.C. Republicans in the House of Representatives recently passed their budget resolution, which could spell trouble for state budgets. The plan tees up major cuts to Medicaid, SNAP, and college tuition assistance—all likely to allow for tax cuts that will overwhelmingly benefit the wealthy. If approved, trillions of dollars would be cut from programs supported by federal dollars and states and localities…

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House Budget Resolution Tees Up Damaging Trump Tax Agenda

• By Steve Wamhoff

The budget resolution passed by House Republicans will enrich the richest, blow up the deficit, and decimate vital public services. The budget resolution allows Congress to pass reconciliation legislation with $4.5 trillion in tax cuts that would mostly flow to the wealthiest families in the country. Congressional Republicans have no way to pay for the massive tax cuts promised by President Trump during his campaign other than to dismantle fundamental parts of the government and…

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Learn from Prop 13 History to Avoid Repeating Past Mistakes

• By Rita Jefferson

Worries about housing costs and property tax bills are leading people to check the history books for solutions, but there’s a danger that they’ll repeat past mistakes. If anti-tax lawmakers carelessly weaken property taxes as they did in the 1970s, as they did with California’s Proposition 13, they will undercut public finances, making municipalities, school districts, and other special districts worse off.

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State Rundown 2/20: Tools to Address Corporate Tax Avoidance and Property Tax Affordability

• By ITEP Staff

A new ITEP report finds that states could raise $19 billion a year with one policy change targeting corporate tax avoidance. That policy, worldwide combined reporting, strengthens state corporate taxation by giving states a full view of multinational corporate profits, essentially eliminating the tax savings that companies currently see by pretending their profits were earned in Switzerland, the Cayman Islands, and other international tax havens.

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Wide-Ranging 2025 State Tax Debates Come into Focus

• By Aidan Davis

In the face of immense uncertainty around looming federal tax and budget decisions, many of which could threaten state budgets, state lawmakers have an opportunity to show up for their constituents by raising and protecting the revenue needed to fund shared priorities. Lawmakers have a choice: advance tax policies that improve equity and help communities thrive, or push tax policies that disproportionately benefit the wealthy, drain funding for critical public services, and make it harder…

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State Rundown 2/12: State Tax Policy Heats Up as Winter Storms Sweep Much of the Country

• By ITEP Staff

Tax policy proposals are a hot topic of conversation across the country. Both North and South Dakota are considering property taxes cuts, while proposed cuts in Florida, Mississippi, and Texas are percolating. Meanwhile, fiscal conditions are tight in states like Alaska, Tennessee, Oklahoma, and West Virginia. None are on the cusp of passing new revenue, but years of recent tax cuts and inflation have caught up to states and many lawmakers have revenue gaps to…

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Turning IRS Agents to Deportation Will Reduce Public Revenues

• By Carl Davis, Jon Whiten

The Trump Administration’s plan to turn IRS agents into deportation agents will result in lower tax collections in addition to the harm done to the families and communities directly affected by deportations.