Reports

report November 28, 2016
Fact Sheet: What You Need to Know About Repatriation Proposals

Fortune 500 corporations collectively have stashed $2.5 trillion in profits offshore, on which they have avoided up to $718 billion in taxes. It’s no wonder that policymakers on both sides of the aisle are weighing legislative options to either tax these profits or create an incentive for corporations to “repatriate” or bring these profits to the United States so that they are subject to taxation.

Lawmakers have introduced several “repatriation” proposals that would glean tax revenue from these offshore profits. But the only solution that will ensure corporations pay taxes on their offshore profits AND shut down the practice of stashing cash offshore is to end deferral, the tax code loophole that allows corporations to indefinitely avoid paying taxes on profits stashed offshore.
report November 15, 2016
Fact Sheet: Comparison of House GOP Tax Plan, Trump’s Initial Tax Proposal and Trump’s Revised Tax Proposal

Chart comparing House GOP Tax Plan, Trump’s Initial Tax Proposal and Trump’s Revised Tax Proposal.
report October 28, 2016
The Short and Sweet on Taxing Soda

The concept of taxing sodas and other sugary beverages has gained traction recently across the United States and around the world. The World Health Organization officially recommended a tax on sugar sweetened beverages as a way to battle the obesity epidemic. In the US, multiple states and localities have looked to taxes on sugar sweetened beverages as a way to improve public health and increase revenue. In 2014, Berkeley, California became the first U.S. locality to enact such a tax. In 2016, similar taxes were enacted in Boulder, Colorado; Albany, Oakland, and San Francisco, California; Cook County, Illinois; and Philadelphia, Pennsylvania.
report October 12, 2016
State Tax Subsidies for Private K-12 Education

This report explains the workings, and problems, with state-level tax subsidies for private K-12 education. It also discusses how the Internal Revenue Service (IRS) has exacerbated some of these problems by allowing taxpayers to claim federal charitable deductions even on private school contributions that were not truly charitable in nature. Finally, an appendix to this report provides additional detail on the specific K-12 private school tax subsidies made available by each state.
report October 4, 2016
Offshore Shell Games 2016

This study explores how in 2015 Fortune 500 companies used tax haven subsidiaries to avoid paying taxes on much of their income. It reveals that tax haven use is now standard practice among the Fortune 500 and that a handful of the country’s wealthiest corporations benefit the most from this tax avoidance scheme.
report September 30, 2016
Comment Letter to FASB on Income Tax Disclosure

We appreciate the Financial Accounting Standards Board’s (FASB) ongoing review of its accounting standards to ensure that financial statements are “facilitating clear communication of information that is important to financial statement users.” Overall, the changes to disclosure requirements proposed by FASB in the exposure draft would represent a significant step forward toward providing users of financial statements the clarity that they need. We believe, however, that the exposure draft does not go far enough in providing the clarity needed and sought by investors and the public alike.
report September 15, 2016
State Tax Codes as Poverty Fighting Tools

Despite this unlevel playing field states create for their poorest residents through existing policies, many state policymakers have proposed (and in some cases enacted) tax increases on the poor under the guise of “tax reform,” often to finance tax cuts for their wealthiest residents and profitable corporations.
report August 8, 2016
Achieving Sustainable Infrastructure Revenue with Gas Tax Reform

This brief outlines the causes of Louisiana’s infrastructure revenue shortfall and offers recommendations for how the state can achieve “sufficient increased levels of recurring funding to address the transportation backlog in highway and bridge maintenance needs in Louisiana,” as per the Task Force’s mandate.
report July 12, 2016
Income Tax Offers Alaska a Brighter Fiscal Future

Read this report in PDF. This month, Alaska legislators regroup in yet another special session where they will consider legislation to address a yawning budget gap created by declining oil…
report June 29, 2016
Ryan Tax Plan Reserves Most Tax Cuts for Top 1 percent, Costs $4 Trillion Over 10 Years

A new distributional analysis of Republican Speaker of the House Paul Ryan’s “A Better Way” policies finds that the plan would: • Add $4 trillion to the national debt over a…
report June 28, 2016
How Long Has it Been Since Your State Raised Its Gas Tax?

An updated version of this report has been published with data through July 1, 2017. Read this Policy Brief in PDF form Many states’ transportation budgets are in disarray, in…
report April 13, 2016
Distributional Analyses of Revenue Options for Alaska

Alaskans are faced with a stark fiscal reality. Following the discovery of oil in the 1960s and 1970s, state lawmakers repealed their personal income tax and began funding government primarily through oil tax and royalty revenues. For decades, oil revenues filled roughly 90 percent of the state’s general fund.
report March 22, 2016
Higher Education Income Tax Deductions and Credits in the States

Read full report in PDF Download detailed appendix with state-by-state information on deductions and credits (Excel) Every state levying a personal income tax offers at least one deduction or credit…
report February 24, 2016
Undocumented Immigrants’ State & Local Tax Contributions (2016)

This report was updated in March 2017 Read as a PDF. (Includes Full Appendix of State-by-State Data) Report Landing Page Public debates over federal immigration reform often suffer from insufficient…
report February 23, 2016
Tennessee Hall Tax Repeal Would Overwhelmingly Benefit the Wealthy, Raise Tennesseans’ Federal Tax Bills by $85 Million

Read PDF of report. Tennessee lawmakers are giving serious consideration to repealing their state’s “Hall Tax” on investment income (so named for the state senator who sponsored the legislation creating…
report February 11, 2016
Tax Foundation Model Seeks to Revive Economic Voodoo

In recent months, the Tax Foundation has used its Taxes and Growth Model (TAG Model) to estimate the impact that a variety of tax policy changes would have on the nation’s economy–including tax plans proposed by current presidential candidates.

The Tax Foundation describes the underlying “logic” of its TAG Model as being rooted in the assumption that “taxes have a major impact on economic growth.” More specifically, the TAG Model has concluded that proposals to lower taxes for high-income individuals and businesses would dramatically grow the economy, and that proposals to raise taxes would significantly slow economic growth.
report January 19, 2016
Testimony before the Vermont Senate Committee on Finance: Tax Policy Issues with Legalized Retail Marijuana

Thank you for the opportunity to testify on the tax policy issues associated with legalized retail marijuana. Our testimony includes five parts:
1. An overview of the marijuana tax rates and structures that exist in the four states (Alaska, Colorado, Oregon, and Washington) where retail marijuana can be legally sold.
2. An analysis of early stage revenue trends in the two states (Colorado and Washington) where legal, taxable sales of retail marijuana have been taking place since 2014.
3. A discussion of issues associated with different types of marijuana tax bases–specifically weight-based taxes, price-based taxes, and hybrids of these two structures.
4. A discussion of issues involved in choosing a tax rate for marijuana.
5. A discussion of long-run issues related to the structure of marijuana taxes and their revenue yield.
report January 13, 2016
ITEP Comments to the Vermont Senate Committee on Finance: Tax Expenditure Evaluation

Thank you for the opportunity to comment on Vermont’s effort to establish a system for regularly evaluating its tax expenditure programs. Data-driven tax expenditure evaluations are a valuable tool for gauging the effectiveness of policy initiatives pursued via the tax code. ITEP is supportive of Vermont’s efforts in this area and is generally encouraged by the work completed thus far by groups such as the Joint Fiscal Office and the Pew Charitable Trusts. Rather than rehash the many useful recommendations made by those organizations, these comments focus on two areas that may be in need of further attention: the scope of what is labeled a “tax expenditure,” and the importance of data infrastructure advancements to the success of these evaluations.
report December 10, 2015
Delaware: An Onshore Tax Haven

When thinking of tax havens, one generally pictures notorious zero-tax Caribbean islands like the Cayman Islands and Bermuda. However, we can also find a tax haven a lot closer to home in the state of Delaware – a choice location for U.S. business formation. A loophole in Delaware’s tax code is responsible for the loss of billions of dollars in revenue in other U.S. states, and its lack of incorporation transparency makes it a magnet for people looking to create anonymous shell companies, which individuals and corporations can use to evade an inestimable amount in federal and foreign taxes. The Internal Revenue Service estimated a total tax gap of about $450 billion with $376 billion of it due to filers underreporting income in 2006 (the most recent tax year for which this data is available).[i] While it is impossible to know how much underreported income is hidden in Delaware shell companies, the First State’s ability to attract the formation of anonymous companies suggests that it could rival the amount of income hidden in more well-known offshore tax havens.
report September 17, 2015
State Tax Codes As Poverty Fighting Tools

The U.S. Census Bureau released data in September showing that the share of Americans living in poverty remains high. In 2014, the national poverty rate was 14.8 percent – statistically unchanged from the previous year. However, the poverty rate remains 2.3 percentage points higher than it was in 2007, before the Great Recession, indicating that recent economic gains have not yet reached all households and that there is much room for improvement. The 2014 measure translates to more than 46.7 million – more than 1 in 7 – Americans living in poverty. Most state poverty rates also held steady between 2013 and 2014 though twelve states experienced a decline.
report September 17, 2015
Low Tax for Whom?: Tennessee is a “Low Tax State” Overall, But Not for Families Living in Poverty

Annual data from the U.S. Census Bureau appear to lend support to Tennessee’s reputation as a “low tax state,” ranking it 50th nationally in taxes collected as a share of personal income.1 But focusing on the state’s overall tax revenues has led many observers to overlook the fact that different taxpayers experience Tennessee’s tax system very differently. In particular, the poorest 20 percent of Tennessee residents pay significantly more of their income (10.9 percent) in state and local taxes than any other group in the state. For low-income families, Tennessee is far from being a low tax state.2 In fact, only thirteen states tax their poorest residents more heavily than Tennessee.
report September 17, 2015
Low Tax for Whom?: South Dakota is a “Low Tax State” Overall, But Not for Families Living in Poverty

Annual data from the U.S. Census Bureau appear to lend support to South Dakota’s reputation as a “low tax state,” ranking it 51st nationally in taxes collected as a share of personal income, the lowest overall tax state.1 But focusing on the state’s overall tax revenues has led many observers to overlook the fact that different taxpayers experience South Dakota’s tax system very differently. In particular, the poorest 20 percent of South Dakota residents pay significantly more of their income (11.3 percent) in state and local taxes than any other group in the state. For low-income families, South Dakota is far from being a low tax state.2 In fact, only eleven states tax their poorest residents more heavily than South Dakota.
report September 17, 2015
Low Tax for Whom?: Washington is a “Low Tax State” Overall, But Not for Families Living in Poverty

Annual data from the U.S. Census Bureau appear to lend support to Washington’s reputation as a “low tax state,” ranking it 36th nationally in taxes collected as a share of personal income.1 But focusing on the state’s overall tax revenues has led many observers to overlook the fact that different taxpayers experience Washington’s tax system very differently. In particular, the poorest 20 percent of Washington residents pay significantly more of their income (16.8 percent) in state and local taxes than any other group in the state. For low-income families, Washington is far from being a low tax state.2 In fact, Washington is the highest tax state in the country for poor people.
report September 17, 2015
Low Tax for Whom?: Florida is a “Low Tax State” Overall, But Not for Families Living in Poverty

Annual data from the U.S. Census Bureau appear to lend support to Florida’s reputation as a “low tax state,” ranking it 48th nationally in taxes collected as a share of personal income.1 But focusing on the state’s overall tax revenues has led many observers to overlook the fact that different taxpayers experience Florida’s tax system very differently. In particular, the poorest 20 percent of Florida residents pay significantly more of their income (12.9 percent) in state and local taxes than any other group in the state. For low-income families, Florida is far from being a low tax state.2 In fact, only three states tax their poorest residents more heavily than Florida.
report September 17, 2015
Low Tax for Whom?: Texas is a “Low Tax State” Overall, But Not for Families Living in Poverty

Annual data from the U.S. Census Bureau appear to lend support to Texas’ reputation as a “low tax state,” ranking it 39th nationally in taxes collected as a share of personal income.1 But focusing on the state’s overall tax revenues has led many observers to overlook the fact that different taxpayers experience Texas’ tax system very differently. In particular, the poorest 20 percent of Texans pay significantly more of their income (12.5 percent) in state and local taxes than any other group in the state. 2 For low-income families, Texas is far from being a low tax state. In fact, only six states tax their poorest residents more heavily than Texas.