Recent Work by ITEP

Expert to North Carolina: Don’t Cap the Gas Tax

June 23, 2011 • By Meg Wiehe

With the state’s gas tax pegged to the price of gasoline, North Carolina is scheduled to raise its gas tax rate on July 1. This increase was entirely predictable, but is understandably controversial. Unfortunately, the debate surrounding what to do in the wake of this increase has been far too narrow, focusing on just two […]

Illinois Must Ignore CME’s Tax Tantrum

June 16, 2011 • By Matthew Gardner

How much is enough? On top of the close to $500 million in corporate tax breaks Illinois doles out each year, Governor Pat Quinn now finds himself confronted by a growing crowd of CEO’s demanding even more. In the wake of tax-break lobbying efforts by Motorola, Sears and Caterpillar, the latest corporation seeking preferential tax […]

ITEP’s Testimony on Combined Reporting Legislation

May 19, 2011 • By ITEP Staff

My testimony today examines the erosion of Rhode Island’s corporate income tax, and the multistate tax avoidance schemes that have contributed to this erosion. In addition, it discusses the single best strategy available to lawmakers seeking to respond to the problem of corporate tax avoidance—mandatory combined reporting. Requiring combined reporting of the income of multistate […]

ITEP’s Testimony on Tax Expenditure Procedural Reform

May 19, 2011 • By Carl Davis

My testimony today focuses on House Bill 5737, which would enact a variety of reforms designed to enhance the level of scrutiny applied to new tax credits, deductions, exemptions, and exclusions. This testimony emphasizes how these reforms would help remove counterproductive biases in favor of relying too heavily on tax preferences; how similar reforms have […]

Connecticut Takes a Stand for Progressive Tax Policy and a Balanced Budget Approach

May 14, 2011 • By Meg Wiehe

Five months into 2011, a glimmer of hope for progressive tax policy and a balanced, sensible approach to state budget woes has emerged in Connecticut. Lawmakers in all but a handful of states are continuing to grapple with historic budget shortfalls as they craft and finalize their budget plans for next year. State revenues continue […]

States Should Not Allow Amazon.com to Bully Them into Forgoing Sales Tax Reform

April 14, 2011 • By Carl Davis

In just the last few weeks, Arkansas and Illinois joined New York, North Carolina, and Rhode Island in enacting legislation requiring some online retailers, like Amazon.com, to collect sales taxes on purchases made by their state’s residents. Vermont’s House of Representatives recently passed similar legislation, and Arizona, California, Connecticut, Hawaii, Massachusetts, Minnesota, Mississippi, Missouri, New […]

ITEP’s Testimony on Sales Tax Modernization Proposal

April 13, 2011 • By Meg Wiehe

My testimony focuses on Governor Chafee’s Sales Tax Modernization Proposal, which would generally broaden Rhode Island’s sales tax base, lower the general state sales tax rate, and raise additional revenue to help mitigate budget cuts. In particular, my testimony will provide thoughts on two components of the governor’s proposal: adding a mix of services to […]

Don’t Give Up on Pease: States Can Decouple from Recent Federal Tax Cuts for Wealthy Itemizers

April 10, 2011 • By Meg Wiehe

In 2011, thirty one states and the District of Columbia allow a group of income tax breaks known as “itemized deductions” (Figure 1). Itemized deductions are designed to help defray a wide variety of personal expenditures that affect a taxpayer’s ability to pay taxes, including charitable contributions, extraordinary medical expenses, mortgage interest payments and state […]

In It for the Long Haul: Why Concerns over Personal Income Tax “Volatility” Are Overblown

March 31, 2011 • By Matthew Gardner

The precipitous drop in state tax collections during the recent recession has prompted some observers to argue that relying on volatile state taxes is a recipe for budgetary disaster. The most recent version of this argument, made by the Wall Street Journal’s Robert Frank, suggests that the personal income tax in particular is highly volatile, […]

Should Illinois Tax Retirement Income?

March 24, 2011 • By Matthew Gardner

Earlier this month, Illinois Senate President John Cullerton suggested that limiting the state’s generous income tax break for retirement income “would just be a matter of fairness.” Senator Cullerton’s suggestion gives Illinois policymakers a welcome opportunity to reflect on the appropriate design of senior-citizen income tax relief in Illinois. This paper summarizes the mechanisms used […]