Louisiana

State tax and budget debates can turn on a dime sometimes, as in Utah this past week, where lawmakers unanimously repealed a tax package they had just approved in a special session last month. Delaware lawmakers are hoping to avoid the similarly abrupt end to their last effort to improve their Earned Income Tax Credit (EITC) by crafting a bill that Gov. John Carney will have no reason to unexpectedly veto as he did two years ago. But at other times, these debates just can’t change fast enough, as in New Hampshire and Virginia, where leaders are searching for revenue to address long-standing transportation needs, and in Hawaii, Nebraska, and North Carolina, where education funding issues remain painfully unresolved.

With the new year and many state legislative sessions just around the corner, most state tax and budget debates are just getting started. Arkansas will be among the states working to improve their roads and other infrastructure. Massachusetts will have to deal with revenue losses due to a misguided tax-cut trigger put in place in prior years. Maryland and South Dakota will be two of many states facing teacher pay shortages and other education funding needs. And debates over the legalization and taxation of cannabis will likely continue in California, Kentucky, New Jersey, and beyond. Utah lawmakers, on the other…

Post enactment of TCJA, lawmakers in most states needed to decide how to respond to the creation of this new program. Given the shortcomings of the federal Opportunity Zones program and its added potential costs to states, the most prudent course of action is three-pronged: States should move quickly to decouple; states should reject look-alike programs; and lawmakers should make investments directly into economically distressed areas.

The last few years have brought major improvements in how states enforce their sales tax laws on purchases made over the Internet. Less than a decade ago, e-retailers almost never collected the sales taxes owed by their customers. The result was a multi-billion dollar drain on state coffers and a competitive disadvantage for local businesses. But this holiday season looks a bit different.

Lawmakers in Michigan and New Hampshire made progress toward enacting their state budgets, though Michigan may yet end up in a government shutdown. Leaders in Wyoming advanced a proposal to create a limited tax on large corporations to raise some revenue and add a progressive element to their state’s tax code. Georgia agencies are forced to recommend their own funding cuts amid state income tax cuts. And business tax subsidies are looking particularly bad in Maryland, where subsidy money has been handed out without verification that companies were creating jobs, and New Jersey, where a false threat to leave the…

This report presents a comprehensive overview of anti-poverty tax policies, surveys tax policy decisions made in the states in 2019 and offers recommendations that every state should consider to help families rise out of poverty. States can jump start their anti-poverty efforts by enacting one or more of four proven and effective tax strategies to reduce the share of taxes paid by low- and moderate-income families: state Earned Income Tax Credits, property tax circuit breakers, targeted low-income credits, and child-related tax credits.

The Earned Income Tax Credit (EITC) is a policy designed to bolster the incomes of low-wage workers and offset some of the taxes they pay, providing the opportunity for families struggling to afford the high cost of living to step up and out of poverty toward meaningful economic security. The federal EITC has kept millions of Americans out of poverty since its enactment in the mid-1970s. Over the past several decades, the effectiveness of the EITC has been magnified as many states have enacted and later expanded their own credits.

Residents of several states are spending their palindrome week reading ballot initiatives forwards and backwards to decide whether or not to support them, including measures to improve education funding in California and Idaho, allow Alaska and Colorado to invest more in public services, and constitutionally prohibit income taxation in Texas. New Jersey lawmakers are giving the same thorough treatment to the state’s corporate tax subsidies. And advocates in Chicago, Illinois, have a bold proposal to flip the script on upside-down taxes there. But devotees of good policy and honest government in North Carolina won’t want to re-read yesterday’s news in…

Six states allow an unusual income tax deduction for federal income taxes paid. These deductions are detrimental to state income tax systems on many fronts, as they offer large benefits to high-income earners and undercut the adequacy and stability of state income tax systems.

Over the last couple of weeks, leaders in Kansas and Missouri reached a historic agreement to stop giving away tax subsidies just to entice companies a couple of miles across their shared state line. Meanwhile, policymakers in Alaska resolved a stand-off over education funding...by cutting education funding slightly less. And California voters may be voting in 2020 on a stronger reform to the notoriously inequitable property tax effects of “Proposition 13.”

Lawmakers in many states have enacted “sales tax holidays” (16 states will hold them in 2019), to provide a temporary break on paying the tax on purchases of clothing, school supplies, and other items. While these holidays may seem to lessen the regressive impacts of the sales tax, their benefits are minimal. This policy brief looks at sales tax holidays as a tax reduction device.

As Americans observe Juneteenth today–the day two years after the Emancipation Proclamation on which news of the end of the Civil War and slavery reached some of the last slaves in Texas—most people’s attention should be on celebrating victories, remembering losses, gathering strength to continue the fight for racial justice, and the accompanying Congressional reparations hearings. In comparison, state tax debates over matters such as reluctance to invest in infrastructure in Michigan and Missouri, approval of income tax cuts in Wisconsin, and a budget standoff in New Jersey may seem unimportant and irrelevant. But we encourage our readers to think about how state policies often serve to enrich and empower white and wealthy households, and…

This week saw lawmakers in Ohio propose significant harmful tax cuts, leaders in California and Oregon work toward strengthening the state Earned Income Tax Credits (EITCs), and governors in Missouri and Kansas declare a truce to end the practice of bribing businesses in the Kansas City area with tax cuts to move from one side of the state line to the other. Meanwhile, Massachusetts leaders are discussing ways of raising taxes on their richest households, which our latest Just Taxes blog post notes is a promising trend this year across many states.

Like certain recent controversially concluded television shows, tax and budget debates can end in many ways and often receive mixed reviews. Illinois leaders, for example, ended on a cliffhanger by approving a historic constitutional amendment to create a graduated income tax in the state, whose ultimate conclusion will be crowdsourced by voters next November. Arizona’s fiscal finale fell flat with many observers due to corner-cutting on needed investments and a heavy focus on tax cuts. Texas legislators went for crowd-pleasing property tax cuts and school funding increases but left a gigantic “but how will we pay for this” plot hole…

Lawmakers and advocates can enjoy their barbeques with only one eye on their work email this weekend in states that have essentially finished their budget debates such as Alaska, Minnesota, Nebraska, and Oklahoma, though both Alaska and Minnesota require special sessions to wrap things up. Getting to those barbeques may be a bumpy ride in Louisiana, Michigan, and other states still working to modernize outdated and inadequate gas taxes.

The upcoming Memorial Day weekend marks the start of the traditional summer driving season. In most states, summer road-trippers are paying more gas tax than they did a few years ago and are benefiting from smoother and safer roads as a result. In total, 30 states have raised or reformed their gas taxes in the last six years.

Tax and budget negotiations remain at standstills in Louisiana and Minnesota, as school funding debates and teacher protests again captured headlines in several states. Oregon lawmakers, for example, finally passed a mixed-bag tax package that won’t improve tax equity but will raise much-needed revenue for education. Meanwhile their counterparts in Nebraska continue to debate highly […]

Teachers in North Carolina and South Carolina are walking out and rallying this week for increased education funding, teacher and staff pay, and other improvements to benefit students—if you’re unsure why be sure to check out research on the teacher shortage and pay gap under “What We’re Reading” below. Meanwhile, budget debates have recently wrapped up in Indiana, Iowa, Massachusetts, New Hampshire, and Washington. And major tax debates are kicking into high gear in both Louisiana and Nebraska.

Tax and budget debates are now mostly complete in Alabama, Arkansas, and Colorado, but just starting or just getting interesting in several other states. Delaware and Massachusetts lawmakers, for example, are looking at progressive income tax increases on wealthy households, and New Hampshire may use a progressive tax on capital gains to simultaneously improve its upside-down tax code and invest in education. Nebraska and Texas, on the other hand, are also looking to improve school funding but plan to do so on the backs of low- and middle-income families through regressive sales tax increases. Fiscal debates are heating up in…

As of 2017, 11.5 million children in the United States were living in poverty. A national, fully-refundable Child Tax Credit (CTC) would effectively address persistently high child poverty rates at the national and state levels. The federal CTC in its current form falls short of achieving this goal due to its earnings requirement and lack of full refundability. Fortunately, states have options to make state-level improvements in the absence of federal policy change. A state-level CTC is a tool that states can employ to remedy inequalities created by the current structure of the federal CTC. State-level CTCs would significantly reduce…

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.

Though a long winter and a rough start to spring weather have wreaked havoc in much of the country, lawmakers are off to a good start in the world of state fiscal policy so far. In the last week, a progressive revenue package was passed in the nick of time in NEW MEXICO, a service-sapping tax cut was vetoed in KANSAS, and a regressive and unsustainable tax shift was soundly defeated in NORTH DAKOTA. Meanwhile, gas tax updates are on the table in MAINE, MINNESOTA, and OHIO. And exemptions for feminine hygiene products and diapers were enacted in VIRGINIA and introduced in MISSOURI. 

As another polar vortex heads for large swaths of the country, state tax debates this week were highly polarized in another way. Lawmakers and advocates in MICHIGAN, OHIO, OREGON, UTAH, and elsewhere fought to enact or improve state Earned Income Tax Credits to give a boost to low- and middle-income working families. But the opposite extreme was heavily represented as well, as others pushed for regressive tax cuts for wealthy individuals and corporations, including in KANSAS, NEBRASKA, NORTH DAKOTA, OHIO, UTAH, and WEST VIRGINIA. Even our “What We’re Reading” section has informative reading on how education funding policy continues to…

Consumption taxes are a significant source of state and local revenue, and we expect that lawmakers will continue to adjust state consumption tax levies to adapt to budget needs and a changing economy.

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.