Colorado

Transportation funding was a hot topic this week, as OHIO lawmakers responsibly voted to update their gas tax and offset some of its impact on lower-income families with an Earned Income Tax Credit (EITC) boost, while NEW YORK enacted the nation’s first “congestion pricing” charge, and LOUISIANA and VIRGINIA leaders looked at gas tax updates as well—a trend ITEP’s Carl Davis explored in depth today here. Broad tax packages are also being hashed out in LOUISIANA, NEBRASKA, OREGON, and TEXAS. And MARYLAND became the sixth state with a $15 minimum wage on the horizon.

More than three billion dollars could be raised under a major progressive tax plan proposed by Illinois Gov. J.B. Pritzker this week, the point being to simultaneously improve the state’s upside-down tax code and address its notorious budget gap issues. One state, Utah, may already be looking at a special session to revisit the sales tax reform debate that ended this week without resolution, in contrast to Alabama and Arkansas, where leaders finally resolved years-long debates over gas taxes and infrastructure funding. And lawmakers in four states – California, Florida, Minnesota, and North Carolina – introduced legislation to expand or…

There is significant room for improvement in state and local tax codes. State tax codes are filled with top-heavy exemptions and deductions and often fail to tax higher incomes at higher rates. States and localities have come to rely too heavily on regressive sales taxes that fail to reflect the modern economy. And overall tax collections are often inadequate in the short-run and unsustainable in the long-run. These types of shortcomings provide compelling reason to pursue state and local tax reforms to make these systems more equitable, adequate, and sustainable.

Happy Valentine’s Day to all lovers of quality research, sound fiscal policy, and progressive tax reforms! This week, some leaders in ARKANSAS displayed their infatuation with the rich by advancing regressive tax cuts, but others in the state are trying to show some love to low- and middle-income families instead. WISCONSIN lawmakers are devoted to tax reductions for the middle class but have not yet decided how to express those feelings. NEBRASKA legislators are playing the field, flirting with several very different property tax and school funding proposals. And VIRGINIA’s legislators and governor just decided to settle for a flawed…

It’s always troubling for those concerned with adequate and fair public finance systems when states prioritize tax cuts at the cost of divesting in important public priorities and exacerbating underlying tax inequalities. But it’s even more nerve-racking when it happens on the eve of what many consider to be an inevitable economic downturn.

Continuing to build upon the momentum of previous years, states are taking steps to create and improve targeted tax breaks meant to lift their most in-need state residents up and out of poverty. Most notably, a range of states are exploring ways to restore, enhance or create state Earned Income Tax Credits (EITC). EITCs are an effective tool to help struggling families with low wages make ends meet and provide necessities for their children. The policy, designed to bolster the earnings of low-wage workers and offset some of the taxes they pay, allows struggling families to move toward meaningful economic…

Gubernatorial addresses and the prospect of teacher strikes continued to take center stage in state fiscal news this week, as governors of Connecticut, Maryland, and Utah gave speeches that all included significant tax proposals. Meanwhile, teachers walked out in Virginia, and many other states debated school funding increases to avoid similar results. State policymakers have many other debates on their hands as well, including what to do with online sales tax revenue, how to cut property taxes without undermining schools, whether and how to legalize and tax cannabis, and whether to update gas taxes for infrastructure investments.

This week, as Americans in every state celebrated Martin Luther King Jr. Day and reflected on his dream of peaceful protest and racial and economic justice, many eyes were on the teachers’ strike pressing for parts of this dream amid the “curvaceous slopes of California.” Governors and lawmakers in many states—including Arizona, Georgia, Indiana, Louisiana, Nevada, New Mexico, South Carolina, and Wisconsin—discussed ways to raise pay for teachers and/or enhance education investments generally.

A first-of-its-kind look at state excise taxes on legal cannabis sales finds that taxing the substance can be a meaningful source of state revenue but cautions that achieving sustainable revenues over time will be difficult under the price-based tax structures adopted in most states thus far.

State policy toward cannabis is evolving rapidly. While much of the debate around legalization has rightly focused on potential health and criminal justice impacts, legalization also has revenue implications for state and local governments that choose to regulate and tax cannabis sales. This report describes the various options for structuring state and local taxes on cannabis and identifies approaches currently in use. It also undertakes an in-depth exploration of state cannabis tax revenue performance and offers a glimpse into what may lie ahead for these taxes.

This year lawmakers in Connecticut, Delaware, Hawaii, Illinois, New Jersey, New York, Rhode Island, and Vermont will all be debating the taxation of recreational cannabis. A new ITEP report reviews the track record of recreational cannabis taxes thus far and offers recommendations for structuring cannabis taxes to achieve stable revenue growth over the long haul.

Gubernatorial speeches and budget proposals dominated state fiscal news this week, as governors proposed a wide array of policies including positive reforms such as Earned Income Tax Credit (EITC) enhancements in CALIFORNIA, a capital gains tax on wealthy households in WASHINGTON, and investments in education in several states. Proposals to exempt more retirement income from tax, particularly for veterans, are a common theme so far this year, having been raised in multiple states including MARYLAND, MICHIGAN, and SOUTH CAROLINA. And NEW JERSEY became the fourth state with a $15 minimum hourly wage. Those wishing to better understand and influence important debates about equitable tax policy should mark their…

Enacting Worldwide Combined Reporting or Complete Reporting in all states, this report calculates, would increase state tax revenue by $17.04 billion dollars. Of that total, $2.85 billion would be raised through domestic Combined Reporting improvements, and $14.19 billion would be raised by addressing offshore tax dodging (see Table 1). Enacting Combined Reporting and including known tax havens would result in $7.75 billion in annual tax revenue, $4.9 billion from income booked offshore.

Following is a statement by Carl Davis, research director at the Institute on Taxation and Economic Policy, regarding the cannabis tax structure unveiled by New York Gov. Andrew Cuomo.

This week we released a handy guide of policy options for Moving Toward More Equitable State Tax Systems, and are pleased to report that many state lawmakers are promoting policies that are in line with our recommendations. For example, Puerto Rico lawmakers recently enacted a targeted EITC-like credit for working families, and leaders in Virginia and elsewhere are working toward similar improvements. Arkansas residents also saw their tax code improve as laws reducing regressive consumption taxes and enhancing income tax progressivity just went into effect. And there is still time for governors and legislators pushing for regressive income tax cuts…

With many people enjoying time off over the next couple weeks, and the longest nights of the year coming over the weekend, now is a good time to get plenty of rest and relaxation in advance of what is likely to be a very busy 2019 for state fiscal policy and other debates. Among those debates, Kentucky lawmakers will be returning to topics they could not resolve in a brief special session held this week, New Jersey and New York will both be deciding how to legalize and tax cannabis, and gas tax updates will be on the agenda in…

State lawmakers are preparing their agendas for 2019 and looking at all sorts of tax and budget policies in the process, raising many familiar questions. Oregon legislators, for example, will try to fill in the blanks in a proposal to boost investments in education that left out detail on how to fund them, while their counterparts in Texas face the inverse problem of a proposed property tax cut that fails to clarify how schools could be protected from cuts. Similar school finance debates will play out in many other states. Alabama, Kansas, and Louisiana will look at gas tax updates,…

State policymakers, voters, and observers have been reflecting on this year’s campaigns and looking ahead to how the policy opportunities in their states have shifted as a result. For example, Arkansas’s governor sees a fresh chance to slash income taxes on the state’s wealthiest residents, while the governor-elect of Illinois will be doing just the opposite, launching into a promised effort to shore up the state’s budget by asking the wealthy to pay more. New York and Virginia residents may end up with buyers’ remorse after Amazon accepted their combined $2 billion tax subsidy offers for its HQ2 project. And…

Tuesday’s elections shook up statehouses, governors’ offices, and tax laws in many states, and in this week’s Rundown we bring you the top 3 election state tax policy stories to emerge. First, voters in Kansas and other states sent a message that regressive tax cuts and supply-side economics have not succeeded and are not welcome among their state fiscal policies. Meanwhile, residents of many other states, including most notably Illinois, voted for representatives who reflect their preference for equitable, sustainable policies to improve their state economies through smart public investments and improve the lives of all residents through progressive tax structures. Lastly, while some states missed…

In this special edition of the Rundown we bring you a voters’ guide to help make sense of tax-related ballot questions that will go before voters in many states in November. Interests in Arizona, Florida, North Carolina, Oregon, and Washington state have placed process-related questions on those states’ ballots in attempts to make it even harder to raise revenue or improve progressivity of their state and/or local tax codes. In response to underfunded schools and teacher strikes around the nation, Colorado voters will have a chance to raise revenue for their schools and improve their upside-down tax system at the…

COLORADO Read as PDF COLORADO STATE AND LOCAL TAXES Taxes as Share of Family Income Top 20% Income Group Lowest 20% Second 20% Middle 20% Fourth 20% Next 15% Next 4% Top 1% Income Range Less than $22,000 $22,000 to $40,800 $40,800 to $65,800 $65,800 to $113,600 $113,600 to $246,000 $246,000 to $605,500 over $605,500 […]

Voters all around the country are educating themselves for the upcoming elections, notably this week around ballot initiatives in Arizona and Colorado and competing gubernatorial tax proposals in Georgia and Illinois. But not all eyes are on the elections, as the relationship between state and local policy made news in Delaware, Idaho, North Dakota, and Ohio.

The IRS recently proposed a commonsense improvement to the federal charitable deduction. If finalized, the regulation would prevent not just the newest workarounds to the $10,000 deduction for state and local taxes (SALT), but also a longer-running tax shelter abused by wealthy donors to private K-12 school voucher programs. ITEP has submitted official comments outlining four key recommendations related to the proposed regulation.