Recent Work

GOP-Trump Tax Framework Would Provide Richest One Percent in Alabama with 56.2 Percent of the State’s Tax Cuts

October 4, 2017 • By ITEP Staff

The “tax reform framework” released by the Trump administration and congressional Republican leaders on September 27 would not benefit everyone in Alabama equally. The richest one percent of Alabama residents would receive 56.2 percent of the tax cuts within the state under the framework in 2018. These households are projected to have an income of at least $501,800 next year. The framework would provide them an average tax cut of $49,830 in 2018, which would increase their income by an average of 3.5 percent.

Indiana’s Tax Cuts Under Mike Pence Are Not a Model for the Nation

September 29, 2017 • By Carl Davis

In announcing a new tax cut framework this week in Indianapolis that was negotiated with House and Senate leaders, President Trump claimed that “Indiana is a tremendous example of the prosperity that is unleashed when we cut taxes and set free the dreams of our citizens …. In Indiana, you have seen firsthand that cutting taxes on businesses makes your state more competitive and leads to more jobs and higher paychecks for your workers.”

State Rundown 9/28: Wisconsin Budget Finalized, Oklahoma Special Session Underway

September 28, 2017 • By ITEP Staff

This week, Wisconsin's leaders finalized the state budget at last, while those in Oklahoma began a special session to close their state's revenue shortfall. Soda tax fights made news in Illinois and Pennsylvania. And New Jersey offered Amazon $5 billion in tax subsidies.

State Rundown 9/25: No Rest for the Weary as State Tax and Budget Debates Wind Down, Ramp Up

September 25, 2017 • By ITEP Staff

Last week, Wisconsin leaders finally came to agreement on a state budget, while their peers in Connecticut appear to be close behind them. Iowa lawmakers avoided a special session with a short-term fix and will have to return to their structural deficit issues next session, as will those in Louisiana who will face a $1 billion shortfall. Meanwhile, District of Columbia leaders have already resumed meeting and discussing tax and budget issues there.

Fact Sheet: The Consequences of Adopting a Territorial Tax System

September 18, 2017 • By Steve Wamhoff

President Trump and Republican leaders in Congress have proposed a “territorial” tax system, which would allow American corporations to pay no U.S. taxes on most profits they book offshore. This would worsen the already substantial problem of corporate tax avoidance and result in more jobs and investment leaving the U.S. Lawmakers should know some key facts about the territorial approach.

Poverty is Down, But State Tax Codes Could Bring It Even Lower

September 15, 2017 • By Misha Hill

The U.S. Census Bureau released its annual data on income, poverty and health insurance coverage this week. For the second consecutive year, the national poverty rate declined and the well-being of America’s most economically vulnerable has generally improved. In 2016, the year of the latest available data, 40.6 million (or nearly 1 in 8) Americans were living in poverty.

State Tax Codes as Poverty Fighting Tools

September 14, 2017 • By ITEP Staff

Astonishingly, tax policies in virtually every state make it harder for those living in poverty to make ends meet. When all the taxes imposed by state and local governments are taken into account, every state imposes higher effective tax rates on poor families than on the richest taxpayers.

Census Data Reveal Modest Gains for Working People; GOP Tax Overhaul Could Reverse These Gains

September 14, 2017 • By Jenice Robinson

On the surface, census poverty and income data released Tuesday reveal the nation’s economic conditions are improving for working families. The federal poverty rate declined for the second consecutive year and is now on par with the pre-recession rate. For the first time, median household income surpassed the peak it reached in 1999 and is […]

State Rundown 9/13: The Year of Unprecedented State Budget Impasses Continues

September 13, 2017 • By ITEP Staff

This week, Pennsylvania lawmakers risk defaulting on payments due to their extremely overdue budget and Illinois legislators will borrow billions to start paying their backlog of unpaid bills. Governing delves into why there were more such budget impasses this year than in any year in recent memory. And Oklahoma got closure from its Supreme Court on whether closing special tax exemptions counts as "raising taxes" (it doesn't).

Trump Proposals Would Reduce the Share of Taxes Paid by the Richest 1%, Raise It for Everyone Else

September 13, 2017 • By Steve Wamhoff

The tax proposals released by the Trump Administration in April would reduce the share of total federal, state and local taxes paid by America’s richest 1 percent while increasing the share paid by all other income groups. This clearly indicates that the tax system would be less progressive under the president’s approach.

Census Data Shows Importance of Refundable Tax Credits in Reducing Poverty, But Lawmakers Move to Restrict Them

September 12, 2017 • By Steve Wamhoff

The annual poverty data released by the Census Bureau today continues to show that federal refundable tax credits are the second most important anti-poverty program after Social Security. But this could change if the House Republicans have their way. The budget resolution approved by Republicans on the House Budget Committee in July would place new […]

Reducing the Cost of Child Care Through State Tax Codes in 2017

September 11, 2017 • By ITEP Staff

Low- and middle-income working parents spend a significant portion of their income on child care. As the number of parents working outside of the home continues to rise, child care expenses have become an unavoidable and increasingly unaffordable expense. This policy brief examines state tax policy tools that can be used to make child care more affordable: a dependent care tax credit modeled after the federal program and a deduction for child care expenses.

Property Tax Circuit Breakers in 2017

September 11, 2017 • By ITEP Staff

State lawmakers seeking to make residential property taxes more affordable have two broad options: across-the-board tax cuts for taxpayers at all income levels, such as a homestead exemption or a tax cap, and targeted tax breaks that are given only to particular groups of low- and middle-income taxpayers. One such targeted program to reduce property taxes is called a “circuit breaker” because it protects taxpayers from a property tax “overload” just like an electric circuit breaker: when a property tax bill exceeds a certain percentage of a taxpayer’s income, the circuit breaker reduces property taxes in excess of this “overload”…

Options for a Less Regressive Sales Tax in 2017

September 11, 2017 • By ITEP Staff

Sales taxes are one of the most important revenue sources for state and local governments; however, they are also among the most unfair taxes, falling more heavily on low- and middle-income households. Therefore, it is important that policymakers nationwide find ways to make sales taxes more equitable while preserving this important source of funding for public services. This policy brief discusses two approaches to a less regressive sales tax: broad-based exemptions and targeted sales tax credits.

State Rundown 9/6: Most Statehouses Quiet, Many Pondering Harvey’s Impacts

September 7, 2017 • By ITEP Staff

It's been a quiet week for tax policy in most states, though lawmakers are still making noise in Pennsylvania, where a budget agreement is still needed, and in Wisconsin, where legislators are searching for the will to raise revenue for the state's ailing transportation infrastructure. In our "What We're Reading" section you'll find interesting reading on the fiscal fallout of Hurricane Harvey, as well as an in-depth series on how states' disaster response needs are likely to continue to increase.