Nineteen states have sales tax holidays on the books in 2024. These suspensions combined will cost states and localities over $1.3 billion in lost revenue this year. Sales tax holidays are poorly targeted and too temporary to meaningfully change the regressive nature of a state’s tax system.
Publications
-
brief August 6, 2024 Sales Tax Holidays Miss the Mark When it Comes to Effective Sales Tax Reform
-
report July 30, 2024 Tax Payments by Undocumented Immigrants
Undocumented immigrants paid $96.7 billion in federal, state, and local taxes in 2022. Providing access to work authorization for undocumented immigrants would increase their tax contributions both because their wages would rise and because their rates of tax compliance would increase.
-
report July 17, 2024 Improving Refundable Tax Credits by Making Them Immigrant-Inclusive
Undocumented immigrants who work and pay taxes but don’t have a valid Social Security number for either themselves or their children are excluded from federal EITC and CTC benefits. Fortunately, several states have stepped in to ensure undocumented immigrants are not left behind by the gaps in the federal EITC and CTC. State lawmakers should continue to ensure that immigrants who are otherwise eligible for these tax credits receive them.
-
report July 16, 2024 Corporate Tax Breaks Contribute to Income and Racial Inequality and Shift Resources to Foreign Investors
Corporate tax cuts and corporate tax avoidance worsen income and racial inequality in our country. Most of the benefits flow to foreign investors and the richest 20% of Americans.
-
report June 27, 2024 Who Benefits and Who Pays: How Corporate Tax Breaks Drive Inequality
Corporate tax breaks and corporate tax avoidance significantly contribute to income and racial inequality and largely benefit foreign investors.
-
report June 26, 2024 States Should Enact, Expand Mansion Taxes to Advance Fairness and Shared Prosperity
The report was produced in partnership with the Center on Budget and Policy Priorities and co-authored by CBPP’s Deputy Director of State Policy Research Samantha Waxman.[1] A historically large share… -
report May 2, 2024 Corporate Taxes Before and After the Trump Tax Law
The Trump tax law slashed taxes for America’s largest, consistently profitable corporations. These companies saw their effective tax rates fall from an average of 22.0 percent to an average of 12.8 percent after the Trump tax law went into effect in 2018.
-
brief April 16, 2024 Is California Really a High-Tax State?
Key Findings For families of modest means, California is not a high-tax state. California taxes are close to the national average for families in the bottom 80 percent of the… -
report April 11, 2024 Fairness Matters: A Chart Book on Who Pays State and Local Taxes
State and local tax codes can do a lot to reduce inequality. But they add to the nation’s growing income inequality problem when they capture a greater share of income from low- or moderate-income taxpayers. These regressive tax codes also result in higher tax rates on communities of color, further worsening racial income and wealth divides.
-
report April 9, 2024 Who Pays Taxes in America in 2024
America’s tax system is just barely progressive, and not nearly as progressive as many suggest or as progressive as it could be. There is plenty of room for lawmakers to improve the progressivity of the tax code to combat economic, wealth, and racial inequality.
-
brief March 14, 2024 Local Mansion Taxes: Building Stronger Communities with Progressive Taxes on High-Value Real Estate
More than one dozen cities and counties levy progressive taxes on high-price real estate transactions — sometimes called mansion taxes — and over a dozen more are considering such policies. By asking buyers and sellers with greater financial means to contribute more to the common good, these policies are equipping communities with resources to make progress on critical challenges of local and national concern.
-
report March 12, 2024 Revenue-Raising Proposals in President Biden’s Fiscal Year 2025 Budget Plan
President Biden’s most recent budget plan includes proposals that would raise more than $5 trillion from high-income individuals and corporations over a decade. Like the budget plan he submitted to Congress last year, it would partly reverse the Trump tax cuts for corporations and high-income individuals, clamp down on corporate tax avoidance, and require the wealthiest individuals to pay taxes on their capital gains income just as they are required to for other types of income, among other reforms.
-
report February 29, 2024 Corporate Tax Avoidance in the First Five Years of the Trump Tax Law
The Trump tax law overhaul cut the federal corporate income tax rate from 35 percent to 21 percent, but during the first five years it has been in effect, most profitable corporations paid considerably less than that.
-
report February 6, 2024 Tax Policy to Reduce Racial Retirement Wealth Inequality
Historic and ongoing discrimination have created stark racial disparities in the US, and the racial retirement wealth gap is one such example.
-
brief February 2, 2024 House SALT Proposal is Expensive, Unneeded, and Poorly Designed
The SALT Marriage Penalty Elimination Act passed by the House Rules Committee on February 1 is costly, decreasing tax revenue by about $8 billion in 2023.
It also mostly only helps taxpayers who are already well off. -
brief February 2, 2024 Impacts of the Tax Relief for American Families and Workers Act
The Tax Relief for American Families and Workers Act passed by the House of Representatives on January 31 is a compromise between lawmakers who want to address child poverty and… -
report January 17, 2024 Ongoing Use of Offshore Tax Havens Demonstrates the Need for the Global Minimum Tax
Key Findings To avoid taxation, American corporations use accounting gimmicks that make profits appear to be earned in foreign jurisdictions which tax corporate profits very lightly or not at all.… -
brief January 16, 2024 Proposed Tax Deal Would Help Millions of Kids with Child Tax Credit Expansion While Extending Damaging Corporate Tax Breaks
On January 16, Congressional tax writers officially announced the details of a tax policy agreement. The deal includes expansions of the Child Tax Credit (CTC) to improve access for low-… -
report December 7, 2023 The Estate Tax is Irrelevant to More Than 99 Percent of Americans
The federal estate tax has reached historic lows. In 2019, only 8 of every 10,000 people who died left an estate large enough to trigger the tax. Legislative changes under presidents of both parties have increased the basic exemption from the estate tax over the past 20 years. This has cut the share of adults leaving behind taxable estates down from more than 2 percent to well under 1 percent.
-
brief November 7, 2023 Far From Radical: State Corporate Income Taxes Already Often Look Beyond the Water’s Edge
State lawmakers are increasingly interested in reforming their corporate tax bases to start from a comprehensive measure of worldwide profit. This provides a more accurate, and less gameable, starting point for calculating profits subject to state corporate tax. Mandating this kind of filing system, known as worldwide combined reporting (WWCR), would be transformative, as it would all but eliminate state corporate tax avoidance done through the artificial shifting of profits into low-tax countries.
-
brief November 2, 2023 America Used to Have a Wealth Tax: The Forgotten History of the General Property Tax
Over time, broad wealth taxes were whittled away to become the narrower property taxes we have today. These selective wealth taxes apply to the kinds of wealth that make up a large share of middle-class families’ net worth (like homes and cars), but usually exempt most of the net worth of the wealthy (like business equity, bonds, and pooled investment funds).The rationale for this pared-back approach to wealth taxation has grown weaker in recent decades as inequality has worsened, the share of wealth held outside of real estate has increased, and the tools needed to administer a broad wealth tax have improved.
-
report October 30, 2023 Local Earned Income Tax Credits: How Localities Are Boosting Economic Security and Advancing Equity with EITCs
Leading localities are using refundable EITCs to boost incomes and reduce taxes for workers and families with low and moderate incomes. These local credits build on the success of EITCs at the federal and state levels, reduce economic hardship and improve the fairness of the tax code.
-
report September 27, 2023 Supreme Corporate Tax Giveaway: Who Would Benefit from the Roberts Court Striking Down the Mandatory Repatriation Tax?
The Supreme Court is set to hear what could become one of the most important tax cases in a century. If decided broadly—with a ruling that strikes down the Mandatory Repatriation Tax for corporations, effectively making it unconstitutional to tax unrealized income—the Roberts Court’s decision in Moore v. US could stretch far beyond the plaintiffs themselves and would put in legal jeopardy many laws that prevent corporations and individuals from avoiding taxes and level the economic playing field.
-
brief September 12, 2023 States are Boosting Economic Security with Child Tax Credits in 2023
Fourteen states now provide Child Tax Credits to reduce poverty, boost economic security, and invest in children. This year alone, lawmakers in three states created new Child Tax Credits while lawmakers in seven states expanded existing credits. To maximize impact, lawmakers should consider making their credits fully refundable, not including an earnings requirement, setting a maximum amount per child instead of per household, setting state-specific phase-out ranges that target low- and middle-income families, indexing to inflation, and offering the option of advanced payments.
-
brief September 12, 2023 Boosting Incomes, Improving Equity: State Earned Income Tax Credits in 2023
Nearly two-thirds of states (31 plus the District of Columbia and Puerto Rico) have an Earned Income Tax Credit, an effective tool that boosts low-paid workers’ incomes and helps lower-income families achieve greater economic security. This year, 12 states expanded and improved EITCs.