Institute on Taxation and Economic Policy

ITEP Work in Action

Wisconsin Budget Project: Tax Shift Would Hike Taxes for People with Low Incomes and Give a Big Tax Cut to the Top 1%

February 7, 2022

Last month, an influential group of lobbyists released a proposal to raise Wisconsin’s sales tax to 8%, making it the highest state sales tax in the country, and eliminate the state individual income tax, Wisconsin’s biggest source of revenue. The plan would result in the largest tax cuts going to white households, with households of color […]

The Commonwealth Institute: Youngkin Administration’s Proposals Would Sharply Reduce State Resources, Largely Exclude Working Families with the Lowest Incomes

February 7, 2022

The Youngkin administration’s tax plan would leave out nearly 80 percent of the over 800,000 taxpayers in Virginia who have incomes below $24,000. Gov. Youngkin’s proposed changes would also sharply reduce state General Fund revenues — the portion of the state budget over which lawmakers have the most discretion and which primarily goes toward funding […]

One Voice: Eliminating Individual Income Tax is Bad for Mississippi

February 7, 2022

House Bill 531 would eliminate the state individual income tax. Eliminating the income tax is bad for Mississippi, especially the state’s working families, communities of color, and retirees. While some lawmakers are suggesting that Mississippi’s revenue system is sound enough to support this tax cut, due to the current surplus, this couldn’t be further from […]

Alabama Arise: Eliminating State Grocery Tax Would Make Life Better for Alabama Families

February 7, 2022

Two bills in the 2022 regular session would end the state grocery tax while protecting school funding. The graph below shows how millions of Alabamians would benefit. Untaxing groceries quickly and responsibly would boost economic and food security for all Alabamians. That means replacing revenue for public schools in a way that doesn’t harm struggling […]

Open Sky Policy Institute: Most Nebraskans Left Behind by Income Tax Cut Bills

February 4, 2022

Non-Nebraskans, corporations and wealthy residents would be big winners under the latest income tax cuts proposed in in LB 938 and LB 939. Meanwhile, the bills – which would ratchet the state’s top corporate and personal income tax rates to 5.84% over four and three years respectively – offer most Nebraskans little tax savings while depleting revenue needed […]

Connecticut Voices for Children: Steps to a Fairer Tax System

February 1, 2022

Although Connecticut has the second highest level of per capita personal income in the US, making it exceptionally wealthy overall, many families consistently struggle because Connecticut also has the second highest level of income inequality and a substantial racial income gap, meaning a small, disproportionately white portion of the population primarily benefits from the state’s […]

The Commonwealth Institute: Tax Proposals Would Reduce Resources for Education, Transportation, and Other Priorities

December 8, 2021

The incoming Youngkin administration and state lawmakers have proposed several major tax proposals to reduce taxes for individuals and businesses. These include one-time tax rebates, dramatically increasing the state standard deduction, eliminating the state and local sales tax on groceries, and pausing the recent increase to the fuels tax. While some of these policy ideas […]

Oklahoma Policy Institute: A Budget and Tax Roadmap for Oklahoma

October 27, 2021

A more just tax system will level the playing field for all Oklahomans, providing more opportunity to save and build wealth. It will also benefit the economy, as equal opportunity for individuals expands the economy as a whole. The state must continue providing and expanding shared services that are often lifelines for low-income individuals, but […]

Arkansas Advocates for Children and Families: Proposed Cuts to the Top Tax Rate Are Costly and Heavily Favor the Rich

October 8, 2021

As the Arkansas Legislature concludes the 2021 general session, our attention must turn to the special session they are preparing to begin to discuss personal income tax cuts. Although income tax cuts may sound like something everyday Arkansans would welcome, when we examine the details, it turns out most Arkansans will be getting a bad […]

Georgia Budget and Policy Institute: How Georgia’s Tax Code Contributes to Racial and Economic Inequality

October 6, 2021

Today, state and local taxes consume a greater share of income earned by Georgians in poverty—who are more likely to be people of color—while the richest pay a far lower share of their income in taxes. As such, Georgians who are among the bottom 20 percent of income earners, those who make less than $20,000 […]

Florida Policy Institute: A Working Floridians Tax Rebate for a Stronger and More Equitable Florida

September 24, 2021

Floridians who are paid lower wages spend significantly more of their income on state and local taxes than those with high income. This is because the state lacks a personal income tax and relies mostly on the sales tax to raise revenue. The state’s upside-down tax code also exacerbates racial inequity because Floridians with low […]

The Commonwealth Institute: Tax Policy in Virginia

September 24, 2021

Black and Latinx people face tremendous barriers in areas like employment, education, and housing. These barriers include explicitly racist policies like school segregation as well as policies that appear “race-neutral” yet reinforce or exacerbate racially inequitable outcomes. Virginia’s upside-down tax code is no different. A more progressive and racially equitable tax code — one that […]

Wisconsin Budget Project: Wisconsin’s Billion-Dollar Tax Cut Leaves out a Huge Chunk of Households

September 9, 2021

Shutting low-income families out of the tax cut will further skew Wisconsin’s tax system, which already requires people with low incomes to pay a higher share of their incomes in state and local taxes than people with much higher earnings. The lowest 20% of Wisconsin households by income, in which households earn less than $22,000 […]

One Voice: Who Pays, Mississippi? An Overview of State Tax Policy and Racial Equity Impacts

August 17, 2021

Historic and current injustices, both in public policy and in society more broadly, have resulted in vast disparities in income across race and ethnicity in Mississippi. State and local tax codes are not the sole contributors to, nor will they be the sole solution to, racial economic inequities. However, the state’s tax system is playing […]

North Carolina Policy Watch: NC House Tax Plan Isn’t Good for Our State (And These Graphs Explain Why This Is the Case)

August 10, 2021

The House tax plan would deliver the greatest share of the net tax cut to the richest North Carolinians. Fifty-six percent of the net tax cut would go to the richest 20 percent in North Carolina. During the House Finance debate, proponents of the tax plan suggested that North Carolinians with poverty-level incomes would see […]

North Carolina Policy Watch: NC’s Tax Code Reinforces Racial Exclusion; Senate’s Proposed Budget Would Make Matters Worse

July 30, 2021

When one applies a unique tool developed by the Institute on Taxation and Economic Policy to assess the racial and ethnic impact of the budget proposal approved by the state Senate in June (SB 105), it becomes clear that the proposed income tax reductions will worsen the state’s exclusionary tax code. This analysis should serve […]

DC Fiscal Policy Institute: NEW VIDEOS: Why DC’s Wealthiest Should Pay their Fair Share

July 12, 2021

The highest income residents in DC pay less as a share of their income than the rest of us. At the same time, low-income Black and brown DC residents have been economically devastated by the pandemic. Watch videos

Washington State Budget & Policy Center: New Reforms Bring Balance and Equity to State’s Tax Code and Economy

July 9, 2021

People seeking a more equitable state tax code and stronger supports for parents scored major victories earlier this year in Washington state, after more than a decade of hard work and focused advocacy by community leaders. By enacting a new excise tax on extraordinary stock profits (capital gains) and an expansive new tax credit for […]

Center for Migration Studies: Innovating Inclusion: A New Wave of State Activism to Include Immigrants in Social Safety Nets

July 1, 2021

States across the country are tackling an equity issue in the tax code by breaking from federal eligibility standards for their state Earned Income Tax Credits (EITCs). Specifically, states are taking it upon themselves to end the exclusion of taxpayers who file their taxes with an Individual Taxpayer Identification Number (ITIN). ITINs are personal tax […]

Policy Matters Ohio: Ohio Tax Cuts Would Go Mostly to the Very Affluent

June 29, 2021

Instead of using Ohio’s public resources to build strong, resilient communities, the General Assembly approved income-tax cuts that would favor the very wealthiest Ohioans, while providing only modest benefits for moderate-income Ohioans and nothing at all to the state’s poorest. Benefiting especially from the elimination of the top bracket of the tax, the most affluent […]

Policy Matters Ohio: ­Ohio Income-tax Cuts Would Reward the Wealthiest

June 29, 2021

Income-tax cuts approved by the General Assembly in the budget bill would favor the very wealthiest Ohioans, while providing only modest benefits for moderate-income Ohioans and nothing at all to the state’s poorest. Benefiting especially from the elimination of the top bracket of the tax, the most affluent 1% of Ohioans would see an average […]

Oregon State Legislature: House Committee On Revenue 06/24/2021

June 24, 2021

Oregon lawmakers discuss a SALT-cap workaround provision. ITEP analysis found that in Oregon more than 91 percent of the tax cut benefits of repealing the SALT cap would go to those earning more than $200,000, and four of five households that benefit are white-led households. Watch here

North Carolina Justice Center: Five Takeaways from the Senate’s Budget Proposal

June 23, 2021

The Senate’s budget plan would bring the state’s investments to a new low while committing the state to untold losses in the form of revenue reductions by eliminating income taxes for profitable corporations by 2028 and lowering the already flat (read: regressive) personal income tax rate. Read more

The Rockefeller Foundation: The Untold Benefits of State EITCs on Child Welfare

June 16, 2021

With the passing of the American Rescue Plan in March, more than 5 million children are projected to be lifted out of poverty this year, cutting child poverty by more than half, through Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) expansions. But what about state tax codes? What can states do to […]

The Arizona Center for Economic Progress: Flat Tax Exacerbates Inequalities for Households of Color

May 26, 2021

Arizona’s elected leaders have created a tax code that is upside down and regressive– meaning that those with low incomes pay a much higher share of their income in taxes compared to Arizona’s highest income earners. Our state’s tax code is both a product of and perpetrator of stark racial inequities. The cumulation of Arizona’s […]

Advocates and policymakers at the state and federal levels rely on ITEP’s analytic capabilities to inform their debates on proposed tax policy changes. In any given year, ITEP fields requests for analyses of policies in 25 or more states. ITEP also works with national partners to provide analyses of federal tax policy proposals. This section highlights reports that use ITEP analyses to make a compelling case for progressive tax reforms.