Recent Work by ITEP

State Rundown 4/29: State Responses and Federal Aid Could Be Among “May Flowers” to Come

April 29, 2020 • By ITEP Staff

April has brought relentless showers of troublesome tax and budget news as the COVID-19 pandemic wreaked havoc on communities and the public services and institutions that both support and depend on them. There is hope, however, that these troubles have opened the eyes of policymakers and that May will bring more clarity and strong action in the form of federal fiscal relief as well as home-grown state and local responses.

Economic Catastrophe in States Looms as Federal Relief Lags

April 29, 2020 • By Amy Hanauer

A bipartisan group of governors and senators from Louisiana to Maryland to Ohio have called for at least $500 billion in state and local fiscal relief. They also need specific help with testing, protective equipment, unemployment costs, Medicaid costs, social services, education and infrastructure. States can’t be on their own as they address the double whammy of plunging revenue and skyrocketing needs.

Pandemic Profits: Netflix’s Record Profit Haul, Past Tax Avoidance Raise Questions about Tax Law’s Weaknesses

April 29, 2020 • By Matthew Gardner

At a time when many companies are facing existential threats due to the COVID-19 pandemic and associated economic shutdown, it is vital to ensure that our corporate tax laws apply fairly to companies that are still turning a profit in these turbulent times.

Sales Tax Policy in a Pandemic: Exemptions for Digital Goods and Services Are More Outdated Than Ever

April 29, 2020 • By Estefan Hernandez Escoto

Many states are making the decline in sales tax collection worse by failing to apply their sales taxes to digital goods (such as downloads of music, movies, or software) and services (such as digital streaming). A state that taxes movie theater tickets but not digital streaming, for instance, is needlessly hastening the decline of its own sales tax.

The CARES Act Provision for High-Income Business Owners Looks Worse and Worse

April 24, 2020 • By Steve Wamhoff

A select group of millionaires will receive an average tax break of $1.6 million thanks to a CARES Act provision that is receiving delayed but well-deserved scrutiny. Wealthy business owners are receiving this windfall because the CARES Act provides tax breaks to people with losses from a business they own.  This approach may seem sensible because businesses small and large are taking a hit from the economic recession, but on close inspection, these provisions benefit those least in need and can be easily abused.

Partying Like It’s 2017: How Congress Went Overboard on Helping Businesses with Losses  

April 24, 2020 • By Steve Wamhoff

The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides some needed relief for individuals and families, but two arcane tax provisions related to business losses will further enrich the wealthy and fail to boost our economy more broadly.

To Avoid the CARES Act’s Flaws, Invest in Automatic Relief

April 23, 2020 • By Jessica Schieder

With adequate automatic stabilizers, the United States might not end up with economic relief bills that have provisions tucked in them mostly helping millionaires, as we learned was the case with a CARES Act provision suspending limits on business losses. And regular people could get help more quickly, blunting the economic downturn.

State Rundown 4/22: Earth Day Lessons from Pangea to Pandemic

April 22, 2020 • By ITEP Staff

In different ways, Earth Day and the COVID-19 pandemic convey a similar lesson: people around the world face shared struggles and disparate impacts, which they must work together to overcome through both emergency action and systemic change. In keeping with that lesson, state fiscal policy news this week was strikingly similar around the country, as states take account of the major threat posed by the pandemic to their budgets and attempt to grapple with its disproportionate impacts on communities of color and low-income families.

It’s Time to Rethink Those Tax Cuts

April 20, 2020 • By Aidan Davis

The full effect of the coronavirus pandemic on state revenue streams remains largely unknown. One key policy option is to reevaluate recent misguided tax cuts—particularly those that have not yet taken full effect and will add to growing revenue shortfalls in the coming years.

Morally and Economically, Including Undocumented Immigrants Is the Right Thing to Do

April 17, 2020 • By ITEP Staff

Undocumented immigrants pay taxes and play an integral part in the social and economic welfare of our country, yet Congress left them almost entirely out of the CARES Act package. Fortunately, immigrants, workers and their allies are helping policymakers advance better policy approaches.