Recent Work

Action (lack thereof) on Economic Aid Reflects Longstanding Anti-Government Agenda

August 14, 2020 • By Amy Hanauer

The biggest danger we face right now is that politicians will fail to get this health crisis under control and Americans will continue to die. The second biggest danger is that elected officials will fail to help families and communities, leading to foreclosures, evictions, and impoverishment—and also torpedoing the economy. With their inaction this week, the Senate seems determined to do both. Hold on everyone, we’re in for a sickening ride.  

State Rundown 8/12: States Find Themselves in New Unemployment Pickle

August 12, 2020 • By ITEP Staff

Even in statehouses, many eyes remained on Congress and President Trump this week as state lawmakers advocated for needed federal fiscal relief and debated whether they can afford to join in on the president’s executive order requiring states to partially fund a new version of enhanced unemployment benefits that have otherwise expired.

IRS Rule Leaves the Door Open for Private/Religious School Voucher Donation Schemes, Broader SALT Cap Workarounds

August 12, 2020 • By Carl Davis

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.

State Rundown 8/6: States Fiscal Solutions Getting Bolder

August 6, 2020 • By ITEP Staff

This week, voters in Missouri approved Medicaid expansion, Nevada lawmakers moved to amend their Constitution to raise taxes on the state’s mining industry, and leaders in California and New York continued to push for needed revenues through tax increases on their richest households.

Between the Lines: Amazon Q2 Report Hints It Will Avoid Taxes on This Year’s Record Profit Haul

August 5, 2020 • By Matthew Gardner

The House Judiciary Committee last week held an antitrust hearing to scrutinize Amazon and other tech companies’ growing dominance. A look at the online retail giant’s new quarterly report and past tax avoidance reveals why lawmakers should be equally concerned about how the tax system allows dominant, profitable corporations to avoid most or all federal tax on their profits. Amazon, yet again, is poised to pay little or no federal income tax on its record profits, and it appears likely to do so using entirely legal tax breaks for stock options and research and development.

Sorry, States: GOP Senate Ignores Need for Federal Relief to State and Local Governments

July 31, 2020 • By Meg Wiehe

During the Great Recession, the most ambitious state revenue-raising efforts closed just 10 percent of shortfalls and most states relied heavily on federal aid and budget cuts to balance their budgets. Of course, states can and should turn to progressive revenue-raising options now, but as the pandemic rages on, the extent of this crisis will become too significant for states and localities to handle on their own. The federal government should step in to help.  

State Rundown 7/29: There is No Offseason During a Pandemic

July 29, 2020 • By ITEP Staff

As many of the country’s major professional sports leagues attempt to return to action amid concerns that the pandemic will find a way to ruin even the best-laid plans, state legislatures find themselves in a similar boat. Lawmakers would normally be enjoying their summer breaks at this time of year, but instead are returning to work in special sessions surrounded by plexiglass and uncertainty. Read on for information on ongoing sessions in states including California, Massachusetts, and Nebraska, as well as upcoming sessions in Missouri and Oregon.

Biden’s Minimum Corporate Tax Proposal: Yes, Please Limit Amazon’s Tax Breaks

July 29, 2020 • By ITEP Staff, Matthew Gardner, Steve Wamhoff

A large majority of Americans want corporations to pay more taxes and Democratic presidential candidate Joe Biden has several proposals to achieve that. The newest idea is to require corporations to pay a minimum tax equal to 15 percent of profits they report to shareholders and to the public if this is less than what they pay under regular corporate tax rules. A recent article in the Wall Street Journal quotes several critics of the proposal, but none of their points are convincing.

Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform

July 29, 2020 • By Dylan Grundman O'Neill

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.

A Cautionary Tale on Sales Tax Holidays During a Pandemic

July 29, 2020 • By Dylan Grundman O'Neill

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.

A Hero vs a Heel: No Contest

July 28, 2020 • By Amy Hanauer

Americans are demanding policy that meets the needs of this urgent moment. There are now competing proposals from the U.S. House and Senate: One is a reasonable response to the staggering crisis we’re in. One is not.

A Tax Loophole You Could Drive a Food Truck Through: Senate GOP Proposes Full Deductibility of Business Meals

July 28, 2020 • By Matthew Gardner

After weeks of being in no particular hurry to assemble a new COVID-19 economic relief package, the Senate GOP has released its plan. It includes the “Supporting America’s Restaurant Workers Act,” which would allow business owners to write off 100 percent of the cost of their restaurant meals through the end of 2020. The two most obvious questions to ask about such a plan are “why” and “why now?” Republican lawmakers have not offered sensible responses to either because they have none.

New Analysis Compares HEROES Act and HEALS Act, Disaggregates Data by Race and Income

July 28, 2020 • By ITEP Staff, Jessica Schieder, Meg Wiehe, Steve Wamhoff

The Health, Economic Assistance, Liability Protection and Schools (HEALS) Act released by Senate Republicans Monday includes a tax rebate that is slightly more generous than the one provided under the March CARES Act, but fails to correct most of the earlier act’s problems. House Democrats addressed these shortcomings in the May HEROES Act, a better starting place for negotiations over the next round of COVID-19 relief. ITEP has analyzed both acts to provide a detailed comparison of how the tax rebate provisions would affect families across the income spectrum and by race. Both measures would provide cash payments to a…

Treasury Secretary Mnuchin to Unemployed Workers: Don’t Worry, Get a Bank Loan   

July 24, 2020 • By Jenice Robinson

In an explanation that can only be called richsplaining, Treasury Secretary Steve Mnuchin on Thursday suggested that Congress’s delay in approving expanded unemployment benefits was no problem because banks would extend loans to people in the meantime.

State Rundown 7/22: The Heat Is On

July 22, 2020 • By ITEP Staff

Temperatures and tensions are high right now across the country as Congress debates its next pandemic response and states continue to sweat through difficult decisions. Nevada lawmakers, for example, just wrapped up a special session during which they came within one vote of a proposed tax increase but ultimately chose to balance their shortfall through only funding cuts. But advocates in many states, including California, New Jersey, New York, and Rhode Island are trying to light a fire under lawmakers to encourage them to enact progressive tax increases on their wealthiest households.