ITEP – Page 95 – Informing tax policy debate nationwide

blog February 7, 2019
Trends We're Watching in 2019: Attempting to Double Down on Failed Trickle-Down Regressive Tax Cuts

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.
blog February 7, 2019
Trends We're Watching in 2019: Cannabis Tax Implementation and Reform

Few areas of state tax policy have evolved as rapidly as cannabis taxation over the last few years. The first legal, taxable sale of recreational cannabis in modern U.S. history did not occur until 2014. Now, just five years later, a new ITEP report estimates that recreational cannabis is generating more than $1 billion annually in excise tax revenues and $300 million more in general sales tax dollars.
blog February 7, 2019
Trends We’re Watching in 2019: Consumption Taxes: the Good, Bad and the Ugly

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.
blog February 7, 2019
Trends We're Watching in 2019: Addressing Lingering Federal Conformity Questions and Opportunities

In our last update on state responses to the federal tax cut (Tax Cuts and Jobs Act, or TCJA), we noted that several states were waiting until 2019 to make their final decisions, giving them additional time to (hopefully) respond in ways that improve their fiscal situations and upside-down tax codes. The TCJA is affecting the 2018 federal taxes people are filing now, in some cases adding urgency and/or confusion to these debates.
blog February 7, 2019
Trends We're Watching in 2019: Raising Revenue and Spending Surpluses to Prioritize Critical Public Investments

A second notable trend in 2019 is states raising revenue to address longstanding needs and states allocating their surpluses to invest in critical public priorities such as early childhood programs, education and other human services.
blog February 7, 2019
Trends We're Watching in 2019: The Use of Targeted Tax Breaks to Help Address Poverty and Inequality

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 security. Lawmakers and advocates for equitable tax policy recognize the value of these credits and are taking steps to reflect that in their state tax codes in the following ways:
February 6, 2019
Shared Prosperity: A Progressive Approach to Marginal Tax Rates

Panel: In recent years, economists have been engaged in robust academic debate over the top marginal tax rate, with leading researchers estimating the optimal rate to be 73 percent or even higher. Yet despite widespread public support for raising the rate from its current level of 37 percent, many policymakers and media figures have demonstrated misunderstandings over what marginal tax rates are and how they work.
blog February 5, 2019
New ITEP Report Shows How Congress Can Meet Public Demand for Progressive Taxes

A recent headline tells us that bold tax plans proposed by lawmakers today reflect a “profound shift in public mood.” But, in fact, the public’s mood has not changed at all. Americans have long wanted progressive taxes but few, if any, lawmakers publicly backed this view. What’s happening now isn’t a shift in public opinion, rather it’s Washington finally catching up with the American people.
blog February 5, 2019
Netflix Posted Biggest-Ever Profit in 2018 and Paid $0 in Taxes

The popular video streaming service Netflix posted its largest-ever U.S. profit in 2018—$845 million—on which it didn’t pay a dime in federal or state income taxes. In fact, the company reported a $22 million federal income tax rebate.
report February 5, 2019
Progressive Revenue-Raising Options

America has long needed a more equitable tax code that raises enough revenue to invest in building shared prosperity. The Tax Cuts and Jobs Act (TCJA), enacted at the end of 2017, moved the federal tax code in the opposite direction, reducing revenue by $1.9 trillion over a decade, opening new loopholes, and providing its most significant benefits to the well-off. The law cut taxes on the wealthy directly by reducing their personal income taxes and estate taxes, and indirectly by reducing corporate taxes.