July 26, 2023
July 26, 2023
The Dog Days of summer are upon us, and with most states out of session and extreme heat waves making their way across the country, it’s a perfect time to sit back and catch up on all your favorite state tax happenings (ideally with a cool drink in hand). Idaho opted for an additional $100 million in property tax cuts, after the state ended the fiscal year with a budget surplus. Meanwhile, at the local level, advocates for robust and sustainable revenue in Chicago, Illinois are pushing for a 3.5 percent city income tax on those earning over $100,000 to help raise revenue without big property tax increases.
Don’t miss our new blog from ITEP’s Andrew Boardman in which he highlights states that have made progress curbing unjust fees and fines and notes that the impact will help rebalance upside-down tax systems and advance racial equity.
Major State Tax Proposals and Developments
- IDAHO Gov. Brad Little announced that, due to the state’s year-end budget surplus, residents would receive an additional $100 million in property tax cuts, bringing the total to approximately $300 million. – MARCO GUZMAN
- TEXAS Gov. Greg Abbott has signed an $18 billion property tax cut bill that will expand the state’s homestead exemption from $40,000 to $100,000, reduce the school property tax rate by 10.7 cents per $100 for homeowners and businesses and provide franchise tax tax, amongst other tax cut policies. The plan will now go to voters for their approval in November. – NEVA BUTKUS
- Gov. Sarah Huckabee Sanders of ARKANSAS is considering a special session to use the state’s $1.161 billion surplus on additional tax cuts.
- The GEORGIA Department of Transportation is launching a pilot program that would charge drivers based on miles traveled in place of a fuel tax.
- MASSACHUSETTS lawmakers are considering a bill that would impose a 5 percent tax on digital streaming providers’ gross annual revenue in the state. A portion of the revenue would go to help municipalities support their community media centers. Meanwhile, a commission of legislators from the House and Senate continue to discuss the state’s broader tax bill that could affect refundable credits and the state’s estate and capital gains taxes.
- Advocates for better tax policy and sustainable revenue in Chicago, ILLINOIS are asking for a 3.5 percent city income tax on household income above $100,000 to raise new revenue without increasing property taxes.
- After NEBRASKA legislators passed a bill that will funnel public dollars away from public schools through tax credits for donations to private school scholarships, tensions have heightened between signature gatherers seeking to give Nebraskans a chance to overturn the bill and “signature blockers” working to deny that chance.
- NEW JERSEY Gov. Phil Murphy signed a bill that will allow remote workers subject to New York income tax a credit against their state tax liability.
- WASHINGTON State’s new long-term care tax has gone into effect and faces renewed efforts to alter or repeal it. Many others in the state are looking forward to the additional security it will provide to those needing care. The tax, which is aimed at helping residents cover the cost of future support services, is a universal benefit that will allow beneficiaries to receive a one-time payment of up to $36,500.
- WEST VIRGINIA rejected the elimination of the state’s personal property tax by referendum. However, lawmakers still chose to create credits against those payments. Their credit process starts now—6 months before the credit takes effect.
- WISCONSIN Republicans have reintroduced a bill that would exempt retirement income from state income taxes. It would apply to the first $100,000 of income for individuals and $150,000 for joint filers. A new proposal to eliminate the state sales tax on baby products has also been filed.
What We’re Reading
- New Jersey and New York policymakers are at odds over how commuters and remote workers between the two states should be taxed. New York is moving forward with a “congestion toll” on drivers entering Manhattan, while New Jersey has filed a lawsuit to stop the toll and also passed a bill changing the taxation of people who live and work in New Jersey for companies based in New York.
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