Just Taxes Blog by ITEP

State Rundown 10/27: Pumpkin Spice & Everything Nice

State Rundown 10/27: Pumpkin Spice & Everything Nice

October 27, 2021

.ITEP Staff

The end of Spooky Season is near but that hasn’t stopped state lawmakers from adding their frightening plans into the bubbling cauldron of bad tax policy ideas. Specifically, in Arkansas, a plan to cut the top personal income tax rate is quickly moving forward, and one Virginia gubernatorial candidate continues to push for billions of dollars in irresponsible tax cuts. Luckily, states more deserving of a treat like California have utilized the revenue from their progressive tax code to be the first in the nation to provide free lunch to all students. And a group of local experts in Nebraska get two handfuls of candy for saying, “Boo!” to a slate of tax cuts that would force the state to rely more on regressive sales taxes.

Major State Tax Proposals and Developments

  • The latest ARKANSAS income tax proposal would cut the state’s top income tax rate from 5.9 percent to 5.3 percent by 2023. Gov. Asa Hutchinson hopes to call legislators into a special session before Thanksgiving. — NEVA BUTKUS
  • In TEXAS, a third special session ended with policymakers punting the decision for property tax cuts to next year’s voters. If approved next year, a constitutional amendment would be created that increases the homestead exemption from $25,000 to $40,000, resulting in roughly a $176 tax cut, on average, for homeowners. — BRAKEYSHIA SAMMS

State Roundup

  • CALIFORNIA’s progressive tax code has made it possible for the state to become the first in the nation to guarantee free breakfast and lunch to all students.
  • Last week, a FLORIDA representative pre-filed a bill (not for the first time) that would eliminate the state’s Urban High-Crime Area Job Tax Credit Program, a tax break created over two decades ago that was intended to support blighted communities but has been exploited by large corporations like Universal Orlando and Walmart. Along similar lines, the representative also pre-filed a bill that would rein in wasteful tax incentives for economic development.
  • IOWA Gov. Kim Reynolds and Senate Majority Leader Jack Whitver are continuing a push for income tax cuts after Iowa’s Revenue Estimating Conference announced a surplus.
  • The MARYLAND Gaming Commission approved additional sports betting licenses. Industry analysts estimate that the sports betting market could bring in approximately $35 million in tax revenue by year three. In other news, Montgomery County Council members introduced a proposal to give out $800 monthly payments for two years to 300 low-income households. The program would be sourced through a private grant and county funds.
  • A bill package to eliminate MICHIGAN’s sales tax on feminine hygiene products is heading to the desk of Gov. Gretchen Whitmer with bipartisan support.
  • After regressive tax overhauls were recently proposed by interest groups in NEBRASKA, local experts have been setting the record straight that these efforts to slash income taxes, eliminate inheritance taxes, and shift to even greater reliance on regressive sales taxes would fail to benefit the vast majority of Nebraskans, particularly rural areas.
  • NEVADA voters will see proposals on the November ballot to raise sales, mining, and gaming taxes – even though the original proponents of those measures attempted to withdraw them after being satisfied with the legislature’s efforts on that front this session.
  • TENNESSEE lawmakers are well on their way to signing a nearly $900 million incentives package for a Ford Motor Company mega-site. Good Jobs First warns that the final cost is likely to top a billion dollars when accounting for potential local subsidies, property tax breaks, and sales tax exemptions.
  • UTAH lawmakers are reevaluating how they allocate tax incentives and subsidies for incoming businesses and other economic development projects, as the state deals with the rapid population growth it has seen over the past ten years.
  • Taxes continue to be a key issue in the contested VIRGINIA gubernatorial race. Republican candidate Glenn Youngkin has backtracked on his plans to eliminate the income tax but continues to pitch roughly $3.2 billion in cuts.
  • WYOMING Gov. Mark Gordon has signed an executive order to provide local businesses with a tax credit to help offset future unemployment insurance taxes.

What We’re Reading


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