Policy Briefs

Nearly two-thirds of states (plus the District of Columbia and Puerto Rico) have an Earned Income Tax Credit. These credits boost low-paid workers’ incomes and offset some of the taxes they pay, helping working class families achieve greater economic security.

Sixteen states provide Child Tax Credits to reduce poverty, boost economic security, and invest in children. State lawmakers have several options to maximize the impact of Child Tax Credits.

New Treasury Department public regulations would drastically reduce tax credit claims by DACA recipients and their families, among others. We find that 158,000 people in households with at least one DACA recipient will suffer financial harm, and that more than half of the impacted individuals are U.S. citizens.

Congress could use its taxing power to ensure a fairer distribution of the fruits of labor, innovation and investment, address the specific harms (the negative externalities) of AI specifically, and acquire a public stake in the companies that are driving the AI revolution.

Many states have repeatedly cut top personal and corporate income tax rates in recent years, sometimes while approving increased sales tax rates to push tax systems in a more regressive direction. Other states, however, have charted a very different course and have moved to increase taxes on higher income households to fund public services.

Twenty states have sales tax holidays in 2026. These sales tax holidays will cost states and localities nearly $600 million in lost revenue this year, and they're poorly targeted and too temporary to meaningfully change the regressive nature of a state’s tax system.

On August 4, Missouri voters will vote on whether to increase taxes on the middle class and seniors to fund tax cuts for the richest households in the state.

We find that 337,000 people in households with at least one DACA recipient will suffer financial harm, and that nearly two-thirds (66 percent) of the impacted individuals are U.S. citizens.

Immigrants and their families in as many as 30 states are at risk of seeing their state tax credits such as the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) reduced unless state lawmakers act.

The approach posits that if policies improve the economic wellbeing of Black women, they will benefit the broader economic health of the rest of the population.

Proposals to index taxes on capital gains for inflation would overwhelmingly benefit the richest 1 percent and increase the deficit by nearly $1 trillion over a decade.

States continue to debate whether and how to link their state tax codes to the 2025 federal tax law. This is not just a technical debate.

South Carolina signed into law a regressive tax cut that will disproportionately benefit the state’s highest-income residents while simultaneously jeopardizing the state’s ability to pay for basic public services in the years to come.

Taxing tourists is a relatively efficient way to ensure that visitors are paying a share of essential government services. Places with a modest number of tourists should limit general sales tax rates to minimize the effect on the full-time population. Places with higher proportions of tourists may have higher sales tax rates to better capture the economic behavior of tourists.

The recent spike in gasoline prices is on pace to cost American drivers an extra $9.4 billion per month. Gas prices are up dramatically across the country, but the South has been hit hardest and is on pace to pay $4.2 billion more per month.

The leaders of Alphabet, Amazon, Meta, and Tesla publicly supported Trump to ensure the most favorable corporate tax policies possible. And Trump delivered for them, both in his 2017 tax bill and again in 2025 with the so-called One Big Beautiful Bill Act.

Sen. Chris Van Hollen has recently introduced the Working Americans’ Tax Cut Act, which offers a generous middle-class tax cut paid for with a new tax on millionaires.

As a result of the tax policies approved by President Trump and the Republican majority in Congress, all but the richest Americans are paying higher taxes on average in 2026 than they did last year.

FDDEI deductions should be repealed for policy reasons alone as they do not serve a legitimate purpose at the state level.

A new proposal in Michigan would create a 5-percentage point surcharge on top earners with taxable incomes over $1 million for joint filers and $500,000 for single filers. This would raise about $1.7 billion a year, which would be used for public education priorities.

A ballot initiative in Massachusetts has proposed cutting the base rate for nearly all income sources from 5 to 4 percent. In 2026, this would cost the state about $5 billion per year of which $347 million would come from the reduced rate on long-term capital gains.

The U.S. needs a tax code that is more progressive and that raises more revenue than the one we have now. An important way to achieve this is to reform the taxation of business profits.

American corporations use accounting gimmicks to make profits appear to be earned in tax havens. This widespread problem could be fixed by Congress enacting legislation to implement a minimum tax on corporations that meets the standards of the global minimum tax that other countries have begun to implement.

State deductions for tips and overtime are not only ineffective at supporting working-class people, it will come at a substantial cost to state budgets.

The 2025 federal tax law risks making 529 plans more costly for states by increasing tax avoidance and allowing wealthy families to use these funds for private and religious K-12 schools.