In a new chart book, Fairness Matters, we further explore our Who Pays? data with new graphics that reinforce the findings in the main report and demonstrate how state-level tax decisions shape economic divides for better and worse.
Dylan Grundman O'Neill
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blog April 17, 2024 The Case for More Progressive State and Local Tax Systems, in Charts
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blog August 6, 2021 State Experimentation with Sales Tax Holidays Magnifies Their Flaws
It’s back-to-school shopping season, so…everyone who buys a cell phone in Arkansas this weekend will do so sales-tax-free. For this whole week in Connecticut, and for the entire spring in New Mexico, the corporate owners of highly profitable multinational restaurant chains had the option to pocket their customers’ taxes rather than remit them to the state to fund vital public services, pass along those savings to their customers, or give a much-needed boost to their employees. And all told, about $550 million of state and local revenue will be forgone in 17 states this year through wasteful and poorly targeted sales tax holidays.
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brief August 6, 2021 Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform
Policymakers tout sales tax holidays as a way for families to save money while shopping for “essential” goods. On the surface, this sounds good. However, a two- to three-day sales tax holiday for selected items does nothing to reduce taxes for low- and moderate-income taxpayers during the other 362 days of the year. Sales taxes are inherently regressive. In the long run, sales tax holidays leave a regressive tax system unchanged, and the benefits of these holidays for working families are minimal. Sales tax holidays also fall short because they are poorly targeted, cost revenue, can easily be exploited, and create administrative difficulties.
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blog July 23, 2021 DC Exemplifies Trend of Tax Justice Victories on the Ground Despite Distractions in the Sky
This month, we watched billionaire space-racers with skyrocketing fortunes literally rocket themselves into the sky to look down on us from the largest gap they could put between themselves and… -
blog April 27, 2021 Bold Progressive State Tax Victories Provide Bright Spots in Difficult Year
“Bold progressive victories” is probably not the first phrase that comes to mind when thinking about state laws enacted so far in 2021…But progressive advocates, lawmakers, and voters have won some tremendous victories in states recently…We should celebrate them for the achievements they are—and closely study them for lessons they can teach about how to bring about positive progressive change in these and other states.
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February 11, 2021 Testimony to Washington State Legislature House Finance Committee on HB 1496
Read as PDF Following is testimony of ITEP Senior State Tax Policy Analyst Dylan Grundman O’Neill submitted to Washington State Legislature House Finance Committee in support of HB 1496. “Hello… -
blog February 4, 2021 States Are Finally Going Bold with Progressive Tax Efforts
Advocates, lawmakers, study commissions, and even governors in some states are proposing bold tax policy reforms that look beyond pandemic-induced budget shortfalls and the “K-shaped recovery” to address underlying inequities and underfunding that gave rise to them. These efforts include proposals to: end or reverse regressive tax policies like the preferential treatment of income derived from wealth over income earned through work; restore or strengthen estate and inheritance taxes to slow the concentration of wealth in ever-fewer hands; raise revenue and slow inequality with progressive income taxes; and many other ideas to right upside-down tax codes while raising the revenue needed to invest in families and shared priorities.
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blog December 21, 2020 Ghosts of Fiscal Crunches Past, Present, Future Have Advice for State Lawmakers
State policymakers and advocates may face some long sleepless nights as they close the book on 2020 and prepare for the important decisions they’ll be making in 2021 and beyond. So we at ITEP have consulted with ghosts of fiscal crunches past, present, and future, and distilled their lessons into seven key things to keep in mind for 2021 tax and budget debates:
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blog October 8, 2020 Putting California Proposition 15 in Context
Californians are voting now on Proposition 15, which would require commercial and industrial property worth $3 million or more to be taxed based on an up-to-date assessment of full market value. Proposition 15 is sound tax policy that would raise much needed revenue and help to advance racial and economic justice.
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brief July 29, 2020 Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform
Lawmakers in many states have enacted “sales tax holidays” (16 states will hold them in 2020) to provide a temporary break on paying the tax on purchases of clothing, school supplies, and other items. These holidays may seem to lessen the regressive impacts of the sales tax, but their benefits are minimal while their downsides are significant—and amplified in the context of the COVID-19 pandemic. This policy brief looks at sales tax holidays as a tax reduction device.
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blog July 29, 2020 A Cautionary Tale on Sales Tax Holidays During a Pandemic
Sixteen U.S. states will hold “sales tax holidays” this year. As ITEP’s newly updated brief explains, these events offer dubious benefits at significant public expense even in normal years, problems which are only amplified in the context of the COVID-19 pandemic.
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report April 15, 2020 State Options to Shore up Revenues and Improve Tax Codes amid Pandemic
The COVID-19 pandemic is an extraordinarily challenging time, as we see harm and struggle affecting the vast majority of our families, businesses, public services, and economic sectors. No one will be unaffected by the crisis, and everyone has a stake in the recovery and faces tough decisions. In the world of state fiscal policy, where revenue shortfalls are likely to be far bigger than can be filled by the initial $150 billion in federal aid or absorbed through funding cuts without causing major harm, tax increases must be among those decisions. Even with more federal support, states will need home-grown revenue solutions in the short, medium, and long terms as the crisis and its fiscal fallout intensify, subside, and eventually give way to a new normal. States must balance their budgets, and research shows that they harm their economies when they choose deep funding cuts to vital public investments over increasing tax contributions from those who can afford them.
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blog March 18, 2020 It’s Time for Some State Fiscal Policy Triage
The COVID-19 novel coronavirus’s effects on public health and economies at all scales are creating a daunting situation for state budgets as well. Lawmakers can choose and prioritize their responses through a straightforward approach similar to that taken by health professionals: marshal and reinforce available resources, triage response options to prioritize the most vital services and most vulnerable people, and enact or strengthen the policies that will help address longer-term issues as well as immediate emergencies.
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blog July 17, 2019 Follow the Money to See How Sales Tax Holidays Are Poor Policy
Sales tax holidays are wasteful, misguided policies that will drain more than $300 million of funding away from shared priorities like schools, roads, and health care this year in 16 states, while delivering little benefit to the families that could most use the help. Our newly updated brief reviews recent developments in sales tax holiday policy—including how online sales taxes are changing the picture—and explains why they are a misguided policy option for states. And the story below “follows the money” to show how sales tax holidays are a bad deal for families and communities alike.
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brief July 17, 2019 Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform
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.
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blog June 12, 2019 Taxing the Rich Works
States are putting evidence into practice with multiple efforts to improve services and tax codes through more progressive taxes on the wealthy. Clear evidence has spread widely this year, informing a national conversation about progressive taxation and leading lawmakers in multiple states to eschew supply-side superstition and act on real evidence instead. Taxing the rich works, and in this Just Taxes blog we review state-level efforts to put these proven findings into effect.
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blog March 11, 2019 North Dakota Senate Should Put the Freeze on House Tax-Cut Plan
Lawmakers in Bismarck were treated last weekend to the largest single day of snowfall the city has ever seen. As state senators begin weighing a bill recently passed by the House that would replace the state’s income taxes with oil revenue, they might want to reflect on how similar oil revenue is to the snow: although both are in extreme abundance right now, both are volatile and unpredictable and will melt away sooner than later. Lawmakers should also consider how eliminating the state’s income taxes might warm the hearts of wealthier North Dakotans but would leave most North Dakota families out in the cold.
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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.
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blog January 30, 2019 Data for the Win: Advocating for Equitable State and Local Tax Policy (Webinar)
Watch the video recording below for discussion on how ITEP’s distributional data can be part of an advocacy and communications strategy for securing state tax policies that raise enough revenue to fund various priorities. Outline includes a brief overview of findings from the sixth edition of Who Pays? A Distributional Analysis of the Tax Systems in All 50 States as well as insight from state advocates who use Who Pays? and other tax policy analyses research to pursue their legislative agendas.
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report January 9, 2019 Moving Toward More Equitable State Tax Systems
New and returning policymakers have a tremendous opportunity to improve their constituents’ lives and their states’ economies through tax policy. This report distills the findings of “Who Pays?” into policy recommendations that can serve as a guide to new lawmakers, advocates, and others seeking to improve their state’s tax codes. It explains the importance of favoring taxes on income and wealth over taxes on consumption, the value of certain targeted tax benefits for families living in poverty, the need to abandon ineffective, unnecessary tax subsidies for high-income households, and the promise of bold new options for improving the regressive distributional outcomes of state and local tax policies.
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blog January 9, 2019 A New Quick-Start Guide to “Who Pays?”
For those looking to start improving on these inequitable tax systems today, we now also offer a helpful companion to “Who Pays?” called “Moving Toward More Equitable State Tax Systems.” This new report distills the findings of “Who Pays?” into a set of policy recommendations – from the foundational to the aspirational – that residents of every state can draw from and start work on now.
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blog July 12, 2018 18 States Will Take Holidays from Sound Tax Policy This Year
State sales tax holidays, our newly updated policy brief shows, are the equivalent of the bad kind of holiday vacation: tax policy that sounds nice at first but ultimately cuts corners, wastes money, precludes better options, and leaves states worse off than they would be without them. Unfortunately, while several states have wised up about sales tax holidays in recent years, 18 states will fall for the superficial attraction of these tax policy gimmicks in 2018.
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brief July 12, 2018 Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform
An updated version of this brief for 2019 is available here. Read this report in PDF. Overview Sales taxes are an important revenue source, composing close to half of all… -
blog July 3, 2018 An Update on State Responses to the Federal Tax Bill
With many state fiscal years beginning July 1, most states that will make decisions this year about federal tax conformity have now done so, so it is now time for an update on how well state policymakers have kept to, or veered from, the path we charted out earlier this year. Most states that have enacted laws in response to the federal changes have adhered to some but not all of the principles we laid out, with a few responding rather prudently and a handful charting a much more treacherous course of unfair, unsustainable policy based on unfounded promises of economic growth.
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blog June 22, 2018 What’s at Stake in South Carolina’s Upcoming Tax Conformity Debate
South Carolina legislators will return next week to try to finalize a few issues before the end of their session and fiscal year on June 30th, including the question of how to respond to the federal Tax Cuts and Jobs Act (TCJA). That’s a short timeframe with some important questions at stake, and some misinformation has been spread, so here’s a quick guide to the facts, issues, and options.