Carl Davis
Carl Davis is the research director at ITEP, where he has worked since 2008. Carl works on a wide range of issues related to both state and federal tax policy. He has advised policymakers, researchers, and advocates on tax policy issues in nearly every state. Much of his work relates to the link between taxes and economic growth, and the shortcomings of dynamic scoring and supply-side economic theories.
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media mention March 16, 2021 Law360: 3 Questions State Tax Pros Have About The Pandemic Relief Law
Policymakers and state tax specialists noticed almost immediately that if states want to take full advantage of the $350 billion cash infusion the ARPA gives state and local governments, it… -
media mention March 15, 2021 MinnPost: Is Minnesota’s Tax System Unfair?
The Institute on Taxation and Economic Policy’s regular assessment of state taxes concludes that just five states and the District of Columbia have positive scores on progressivity: California, Delaware, New… -
blog March 15, 2021 State and Local Cannabis Tax Revenue Jumps 58%, Surpassing $3 Billion in 2020
Cannabis taxes are a small part of state and local budgets, clocking in at less than 2 percent of tax revenue in the states with legal adult-use sales. But they’re… -
brief March 5, 2021 How Long Has It Been Since Your State Raised Its Gas Tax?
Many state governments are struggling to repair and expand their transportation infrastructure because they are attempting to cover the rising cost of asphalt, machinery, and other construction materials with fixed-rate gasoline taxes that are rarely increased.
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media mention March 1, 2021 Marketplace: High-income taxpayers help some states stay above water
However, in 22 states, tax revenue actually increased, with revenue in four states — Idaho, Utah, South Dakota and Colorado — up more than 5%. Revenue fell in the remaining… -
blog February 24, 2021 Income Tax Discussion Continues in Alaska
Alaska is notoriously reliant on tax and royalty revenue from oil to fund vital public services and institutions, but declining oil prices and production levels have rendered those revenues inadequate to meet the state’s needs. ITEP analysis of potential state income tax options in Alaska shows the potential to raise between $526 million and $696 million per year yet are quite modest compared to personal income tax structures in other states. When measured relative to state residents’ incomes, any of these options would rank among the bottom five lowest state income taxes in the nation.
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report February 24, 2021 Comparing Flat-Rate Income Tax Options for Alaska
Alaska lawmakers are facing an unprecedented fiscal crisis. The state is more dependent than any other on oil tax and royalty revenues but declines in oil prices and production levels have sapped much of the vitality of these revenue sources. One way of diversifying the state’s revenue stream and narrowing the yawning gap between state revenues and expenses would be to reinstitute a statewide personal income tax. Alaska previously levied such a tax until 1980. This report contains ITEP’s analysis of the distributional impact and revenue potential of a variety of flat-rate income tax options for Alaska, based on draft legislation provided by the Legislative Budget and Audit Committee.
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media mention February 16, 2021 The New York Times: California: Liberal Model or Cautionary Tale?
Below is an excerpt of an LTE by ITEP Research Director Carl Davis: Of course, the very richest people in California pay more tax than they would if they… -
blog February 12, 2021 It’s Been 10,000 Days Since the Federal Government Raised the Gas Tax
10,000 days. More than 27 years. By next Tuesday that’s how long it will have been since the federal government last raised the gas tax. Over that time, vehicle fuel efficiency has improved by 25 percent and construction costs have grown 185 percent. And yet the federal gas tax has remained frozen at 18.3 cents per gallon, with its purchasing power shrinking by the day. The federal government has never gone this long without updating the nation’s gas tax rate.
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blog February 9, 2021 Does New York’s Cannabis Tax Idea Offer a Glimpse of the Future?
Taxing cannabis won’t end New York’s budget difficulties, but a potency tax could bring New York a more sustainable stream of cannabis tax revenue than we see in most states. It could also have significant benefits for cannabis consumers.
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media mention February 2, 2021 Bloomberg: Vehicle Mile Tax Draws Fresh Attention as Buttigieg Takes Post
Large segments of the population are as skeptical of government as they’ve ever been, so asking them to install devices in their vehicles to determine how far and sometimes even… -
media mention January 29, 2021 Law 360: La. Gov. Won’t Support Gas Tax Hike This Year Due To Virus
A January report from the American Petroleum Institute said Louisiana’s total per-gallon state taxes and fees of 20.01 cents on fuel rank below the national average of 36.83 cents for… -
media mention January 27, 2021 The 74: With DeVos Out, Movement for Private School Choice Shifts to State Legislatures
The scholarship policies rely on tax credits — from 50 up to 100 cents on the dollar, depending on the state — in return for contributions to assist with private… -
blog January 12, 2021 New Jersey Leads by Example with Its New Cannabis Tax
New Jersey lawmakers passed an innovative tax design that other states debating cannabis legalization should look to for inspiration. The state officially legalized cannabis in November when voters overwhelmingly approved a constitutional amendment by a margin of 67 to 33 percent. The amendment applied the state’s general sales tax to cannabis and allowed local governments to create their own taxes on the industry. The legislature added the most notable part of the tax structure last month with a Social Equity Excise Fee.
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media mention December 28, 2020 Bloomberg Tax: Taxing Tech Giants on Cash-Strapped States’ Agendas in New Year
The spate of proposals could mean higher tax bills for tech titans Amazon, Apple, Facebook, Google, Microsoft, and Netflix, in addition to the millions of consumers using their services. Agencies… -
media mention December 10, 2020 Bloomberg: Musk Flees California. He Now Faces a Battle to Escape Its Taxes
Fear of rich people moving for tax reasons is overblown, says Carl Davis, research director at the left-leaning Institute on Taxation and Economic Policy, or ITEP. Studies show the wealthy… -
media mention November 16, 2020 Marketplace: Could the success of ballot measures to legalize marijuana add pressure for federal legalization?
Carl Davis, research director at the Institute on Taxation and Economic Policy, studies states’ cannabis tax structures and he said one problem is that most states’ excise tax is based… -
blog October 14, 2020 A Conservative Supermajority on the Supreme Court Could Be a Boon to Wealthy Tax Cheats
By early next year, the Supreme Court could be operating under a 6-3 conservative supermajority that may unwind hard-fought progressive reforms across every area imaginable. While reproductive rights and health care are at the forefront of public discourse, the Court’s impact will extend far beyond these two areas. Voting rights, the battle against climate change, anti-discrimination laws, the separation of church and state and yes, even progressive taxation, are all at risk.
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blog September 23, 2020 Another Reason to Tax the Rich? States with High Top Tax Rates Doing as Well, if Not Better, than States Without Income Taxes
ITEP updated a 2017 study that examined the economic performance of the nine states with the highest top marginal tax rates compared to the nine states with no state income tax. Economies in states with the highest top marginal rates grew faster. States facing budget shortfalls should first look at raising taxes on those most able to pay (incomes at the top have grown during this economic crisis) before considering harmful budget cuts.
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media mention September 15, 2020 Yahoo! Finance: Salt Cap Isn’t Scaring Away Blue State Millionaires
The $10,000 cap on state and local tax deductions imposed as part of the 2017 Republican tax law is not causing high-income taxpayers to flee high-tax blue states, according to… -
media mention September 14, 2020 Bloomberg: DeVos-Backed School-Choice Groups Hurt by SALT Rules Crackdown
Critics of state tax credits say the IRS workaround rules were a common-sense effort to address donors double-dipping on tax credits — essentially collecting state and federal tax benefits on… -
media mention September 8, 2020 Politico Morning Tax: They’re back, but stalemate continues
Carl Davis of the progressive Institute on Taxation and Economic Policy wrote a piece last week using new IRS data that specifically focused on the $10,000 cap on state and… -
blog September 3, 2020 Millionaire Population Swells in Blue States Despite Migration Fearmongering
Although the 2017 Tax Cuts and Jobs Act has created a slew of problems, it is now clear that a mass migration of top earners out of higher-tax blue states is not one of them.
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blog September 3, 2020 The Rich Are Weathering the Pandemic Just Fine: Tax Them
Reductions in critical state and local investments, including health care and education, would only exacerbate the economic crisis brought on by COVID-19 and worsen racial and income inequality for years to come. Higher taxes on top earners are among the best options for addressing pandemic-related state revenue shortfalls in the coming months.
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blog August 12, 2020 IRS Rule Leaves the Door Open for Private/Religious School Voucher Donation Schemes, Broader SALT Cap Workarounds
An IRS regulation released last Friday sanctions a widely derided tax dodge that allows profitable businesses to avoid taxes by sending money to private and religious school voucher funds. It also leaves the door open to a brand of state and local tax (SALT) cap workaround that previously appeared to be on its way out.