COVID-19

map December 21, 2020
National and State-by-State Estimates of New $600 Cash Payments

The House and Senate are about to pass the first COVID-19 relief legislation since the CARES Act was enacted in March. The new relief package includes, among other provisions, cash payments of $600 per person, which is half as large as the payments provided under the CARES Act, but also extends payments to spouses and children of certain undocumented immigrants who were left out of the previous payments.
blog December 8, 2020
A Second Round of Direct Cash Payments Could Provide an Average $1,550 to the Poorest Families

It will not magically become easier for families to put food on the table or make their next rent payment. Policymakers must act. People are struggling because they are either out of work, involuntarily working part-time, trying to financially catch up after being out of work for a spell, or squeaking by because we live in a wealthy democracy that fails to guarantee basics such as access to affordable housing, health care, food, and jobs that pay living wages.
blog December 4, 2020
McConnell Balked at More Stimulus Aid to States, Betting Red States Wouldn’t Need It. Now?

It is December 2020. Sen. McConnell has denied states—and their residents—relief for months. Congress must act now. Even if it does, it is unlikely to provide the robust aid needed to keep communities afloat and positioned for healthy recovery. Lawmakers across the country should be prepared to return to state capitals and city halls in the new year with plans to raise revenue not just to weather this crisis, but also to invest in long-term recovery.
blog December 4, 2020
These EITC Reforms Would Help Struggling Families Now and Address Systemic Challenges

The tepid economic recovery is leaving millions behind. The nation still has nearly 10 million jobs less than it did in February, according to the latest jobs report. The number of people living in or near poverty is rising. Twelve million workers are about to lose their unemployment insurance, roughly four in 10 people report experiencing food insecurity for the first time, and conditions are likely to deteriorate further in the weeks ahead as we brace for another deadly surge in COVID cases and new or tightened restrictions on business and personal activity.
blog December 3, 2020
COVID-19 Containment Is Key to Recovery—So Is Another Round of Stimulus

You can learn a lot about our leaders from how they act during times of crisis. This December, we are in our 10th month of the pandemic in the United States. With COVID cases climbing, deaths exceeding 270,000 and hospitalizations surpassing 100,000 for the first time, some states have halted reopening plans and imposed new restrictions.

Containment of the virus is key to sustained economic recovery. As is another round of federal stimulus.
blog November 20, 2020
State Tax Policy: Innovations to Embrace, Schemes to Avoid

Better tax policies will help communities emerge from the current staggering fiscal crisis with tax structures that reduce inequality at a time when rich people are thriving and public services are under siege. Preserving public spending will boost the economy and improve lives–and cutting these essentials will not only hurt people but also deepen the downturn, a lesson we learned in the Great Recession’s slow recovery. Other states should take note.
blog November 12, 2020
Biden’s Economic Policy Agenda Deserves Serious Debate, Not Obstruction

Obstructing policies that improve economic well-being should not be on any party’s legislative agenda, especially when so many are barely keeping their heads above water.
news release September 30, 2020
People Need Relief. House Compromise COVID-19 Bill Addresses Urgent Needs

Media contact Following is a statement by Amy Hanauer, executive director of the Institute on Taxation and Economic Policy, regarding the COVID-19 relief bill that the U.S. House is expected…
blog September 24, 2020
Of Shiny Objects and Scapegoats

While the moneyed elite were dangling shiny objects, scapegoating Black and brown people, denigrating immigrants, and financing studies to convince us that poor people are the problem, they were concurrently securing policies that cut taxes primarily for the rich and profitable corporations, deregulated industry, weakened unions and attacked voting rights. This and more allowed the rich to amass even more wealth and power.
blog September 3, 2020
The Rich Are Weathering the Pandemic Just Fine: Tax Them

Reductions in critical state and local investments, including health care and education, would only exacerbate the economic crisis brought on by COVID-19 and worsen racial and income inequality for years to come. Higher taxes on top earners are among the best options for addressing pandemic-related state revenue shortfalls in the coming months.
blog August 17, 2020
Trump’s Executive Order on Social Security Payroll Taxes Is a Mess

President Trump’s executive order that would supposedly allow workers to delay paying Social Security taxes, along with his related public statements, have created a situation that is bizarre even by 2020 standards.
blog August 14, 2020
Action (lack thereof) on Economic Aid Reflects Longstanding Anti-Government Agenda

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.
blog July 31, 2020
Sorry, States: GOP Senate Ignores Need for Federal Relief to State and Local Governments

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.
brief July 29, 2020
Sales Tax Holidays: An Ineffective Alternative to Real Sales Tax Reform

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.
blog July 29, 2020
A Cautionary Tale on Sales Tax Holidays During a Pandemic

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.
blog July 28, 2020
A Hero vs a Heel: No Contest

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.
brief July 28, 2020
New Analysis Compares HEROES Act and HEALS Act, Disaggregates Data by Race and Income

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 majority of individuals and families, but the HEROES Act goes farther and is more inclusive.
blog July 24, 2020
Treasury Secretary Mnuchin to Unemployed Workers: Don’t Worry, Get a Bank Loan

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.
news release July 23, 2020
Republican COVID Relief Plan Doesn’t Rise to the Moment

Media contact Following is a statement by Amy Hanauer, executive director of the Institute on Taxation and Economic Policy (ITEP), regarding the pending Republican plan for phase IV COVID-19 relief.…
blog July 21, 2020
New ITEP Report on Trump’s Payroll Tax Holiday

While the White House hasn’t clarified what it is proposing, we know that a payroll tax cut would not be well-targeted. In a new report, ITEP estimates the effects of suspending Social Security and Medicare payroll taxes for employees and employers from September 1 through the end of the year. We find that 64 percent of the benefits would go to the richest 20 percent of Americans while 24 percent of the benefits would go to the richest 1 percent.
report July 21, 2020
An Updated Analysis of a Potential Payroll Tax Holiday

ITEP estimates that if Congress and the president eliminated all Social Security and Medicare payroll taxes paid by employers and employees from Sept. 1 through the end of the year, 64 percent of the benefits would go the richest 20 percent of taxpayers and 24 percent of the benefits would go to the richest 1 percent of taxpayers, as illustrated in the table below. The total cost of this hypothetical proposal would be $336 billion.
blog July 17, 2020
SALT Cap Repeal Has No Place in COVID-19 Legislation: National and State-by-State Data

The Trump-GOP tax law enacted at the end of 2017 includes a $10,000 cap on the amount of state and local taxes (SALT) that people can deduct on their federal tax returns, and this is one of the few limits the law places on tax breaks for high-income people. Unfortunately, it is also the provision that some Democrats are most determined to remove.
blog July 1, 2020
New Fiscal Year Brings New Challenges and Opportunities in the States

July 1—the start of the new fiscal year in most states—typically marks a point when one can take a step back and reflect on the wins and disappointments of the past state legislative sessions. 2020 is markedly different. Nationwide business closures and stay-at-home orders in response to COVID-19 have led to unprecedented spikes in unemployment, decreased demand for consumer spending, and increased demand for vital public services. As a result, states face incredibly uncertain financial futures with little clarity regarding how their tax collections will fare over the next year.
blog June 23, 2020
McSally “Travel Tax Credit” Is an Invitation for Tax Avoidance

Earlier this week, U.S. Sen. Martha McSally (R-AZ) introduced the “American TRIP Act,” a bill ostensibly designed to encourage Americans to boost the economy by traveling within the United States. The bill is certainly a trip in the colloquial sense of the word.
blog June 2, 2020
White House Incredibly Still Believes Tax Cuts Are the Answer to America’s Problems

White House officials continue to discuss tax cuts in response to the COVID-19 pandemic. Steve Wamhoff provides a roundup of these terrible ideas that would do little to boost investment or reach those who need it most.